Gender-Specific Occupational Segregation, Glass Ceiling Effects, and Earnings in Managerial Positions: Results of a Fixed Effects Model

28 Pages Posted: 29 Jan 2011 Last revised: 27 Feb 2011

See all articles by Anne Busch

Anne Busch

German Institute for Economic Research (DIW Berlin) - German Socio Economic Panel

Elke Holst

German Institute for Economic Research (DIW Berlin); German Institute for Economic Research (DIW Berlin) - German Socio Economic Panel

Multiple version iconThere are 2 versions of this paper

Date Written: January 19, 2011

Abstract

The study analyses the gender pay gap in private-sector management positions in Germany based on data from the German Socio-Economic Panel Study (SOEP) for the years 2001-2008. It focuses in particular on gender segregation in the labor market, that is, on the unequal distribution of women and men across different occupations and on the effects of this inequality on earnings levels and gender wage differentials in management positions. Our paper is, to our knowledge, the first in Germany to use time-constant unobserved heterogeneity and gender-specific promotion probabilities to estimate wages and wage differentials for persons in managerial positions. The results of the fixed effects model show that working in a more “female” job, as opposed to a more “male” job, affects only women’s wages negatively. This result remains stable after controlling for human capital endowments and other effects. Mechanisms of the devaluation of jobs not primarily held by men also negatively affect pay in management positions (evaluative discrimination) and are even more severe for women (allocative discrimination). However, the effect is not linear; the wage penalties for women occur only in “integrated” (more equally male/female) jobs as opposed to typically male jobs, and not in typically female jobs. The devaluation of occupations that are not primarily held by men becomes even more evident when promotion probabilities are taken into account. An Oaxaca/Blinder decomposition of the wage differential between men and women in management positions shows that the full model explains 65 percent of the gender pay gap. In other words: Thirty-five percent remain unexplained; this portion reflects, for example, time-varying social and cultural conditions, such as discriminatory policies and practices in the labor market.

Keywords: Gender Pay Gap, Managerial Positions, Gender Segregation, Glass-Ceiling Effects, Oaxaca/Blinder Decomposition, Fixed Effects, Selection Bias

JEL Classification: J31, J16, J24

Suggested Citation

Busch, Anne and Holst, Elke, Gender-Specific Occupational Segregation, Glass Ceiling Effects, and Earnings in Managerial Positions: Results of a Fixed Effects Model (January 19, 2011). SOEPpaper No. 357; DIW Berlin Discussion Paper No. 1101. Available at SSRN: https://ssrn.com/abstract=1750260 or http://dx.doi.org/10.2139/ssrn.1750260

Anne Busch (Contact Author)

German Institute for Economic Research (DIW Berlin) - German Socio Economic Panel ( email )

DIW Berlin
Berlin, Berlin 14191
Germany

Elke Holst

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstraße 58
Berlin, 10117
Germany

German Institute for Economic Research (DIW Berlin) - German Socio Economic Panel ( email )

DIW Berlin
Berlin, Berlin 14191
Germany

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