The Gender Pay Gap: Micro Sources and Macro Consequences

107 Pages Posted: 23 May 2018 Last revised: 24 Aug 2023

See all articles by Iacopo Morchio

Iacopo Morchio

University of Bristol - Department of Economics

Christian Moser

Columbia University; Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Multiple version iconThere are 2 versions of this paper

Date Written: August 18, 2023

Abstract

Using linked employer-employee data from Brazil, we document a large gender pay gap due to women working at lower-paying employers with better nonpay attributes. To interpret these facts, we develop an equilibrium search model with endogenous firm pay, amenities, and hiring. We provide a constructive proof of identification of all model parameters. The estimated model suggests that amenities are important for both men and women, that compensating differentials explain half of the gender pay gap, and that there are significant output and welfare gains from eliminating gender differences. However, equal-treatment policies fail to achieve those gains.

Keywords: Wage Inequality, Amenities, Equilibrium Search Model, Linked Employer-Employee Data, Compensating Differentials, Taste-Based Discrimination, Monopsony Power

JEL Classification: E24, J16, J31, J32

Suggested Citation

Morchio, Iacopo and Moser, Christian, The Gender Pay Gap: Micro Sources and Macro Consequences (August 18, 2023). Available at SSRN: https://ssrn.com/abstract=3176868 or http://dx.doi.org/10.2139/ssrn.3176868

Iacopo Morchio

University of Bristol - Department of Economics ( email )

8 Woodland Road
Bristol BS8 ITN
United Kingdom

Christian Moser (Contact Author)

Columbia University ( email )

3022 Broadway
New York, NY 10027
United States
6093564653 (Phone)

HOME PAGE: http://www.economoser.com

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
2,122
Abstract Views
6,551
Rank
13,654
PlumX Metrics