Wage Earners, Self-Employed and Gender in the Informal Sector in Turkey

Abstract

This study considers covered and uncovered wage earners and the self-employed. The analysis is carried out for men and women workers separately. 1994 Turkish Household Expenditure Survey is used first to examine how individuals are selected into the covered and uncovered wage earner and the self-employed categories. Next, selectivity-corrected wage equations are estimated to examine wage determination in these sectors. Oaxaca-Blinder decomposition of sector of work and male-female wage differentials are carried out. When controlled for the observed characteristics and sample selection for men, covered wage earners earn more than the uncovered wage earners and the self-employed. For the covered wage earners, men's expected wages are about twice higher than the women's wages. For the uncovered wage earners, men's wages are near parity with those of women. These results suggest segmentation for men along the formal and informal lines and substantial discrimination for women in the covered private sector.

Keywords: Informal sector, Wage Earners, Self-employed, Gender

JEL Classification: J16, J31, J42