Cognitive, Non-Cognitive Skills and Gender Wage Gaps: Evidence from Linked Employer-Employee Data in Bangladesh

36 Pages Posted: 4 Sep 2015

See all articles by Christophe J. Nordman

Christophe J. Nordman

Institut de Recherche pour le Developpement (IRD); IRD, DIAL, Paris

Leopold R. Sarr

Cornell University - Food and Nutrition Policy Program

Smriti Sharma

United Nations - World Institute for Development Economics Research (UNU/WIDER)

Abstract

We use a first-hand linked employer-employee dataset representing the formal sector of Bangladesh to explain gender wage gaps by the inclusion of measures of cognitive skills and personality traits. Our results show that while cognitive skills are important in determining mean wages, personality traits have little explanatory power. However, quantile regressions indicate that personality traits do matter in certain parts of the conditional wage distribution, especially for wages of females. Cognitive skills as measured by reading and numeracy also confer different benefits across the wage distribution to females and males respectively. Quantile decompositions indicate that these skills and traits reduce the unexplained gender gap, mainly in the upper parts of the wage distribution. Finally, results suggest that employers place greater consideration on observables such as academic background and prior work experience, and may also make assumptions about the existence of sex-specific skills of their workers, which could then widen the within-firm gender wage gap.

Keywords: gender wage gap, cognitive skills, personality traits, matched worker-firm data, quantile decompositions, Bangladesh

JEL Classification: J16, J24, J31, J71, C21, O12

Suggested Citation

Nordman, Christophe Jalil and Nordman, Christophe Jalil and Sarr, Leopold R. and Sharma, Smriti, Cognitive, Non-Cognitive Skills and Gender Wage Gaps: Evidence from Linked Employer-Employee Data in Bangladesh. Available at SSRN: https://ssrn.com/abstract=2655081 or http://dx.doi.org/10.2139/ssrn.2655081

Christophe Jalil Nordman (Contact Author)

Institut de Recherche pour le Developpement (IRD)

213, rue La Fayette
75480 Paris cedex 10, 90009
France

IRD, DIAL, Paris

213, rue La Fayette
75480 Paris cedex 10, 90009
France

Leopold R. Sarr

Cornell University - Food and Nutrition Policy Program ( email )

Department of Economics
Ithaca, NY 14853
United States
607-255-8093 (Phone)
607-255-0178 (Fax)

Smriti Sharma

United Nations - World Institute for Development Economics Research (UNU/WIDER) ( email )

Katajanokanlaituri 6B
Helsinki, FIN-00160
Finland

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