Analyzing Wage Differentials By Fields of Study: Evidence from Turkey

XREAP 2017-02

62 Pages Posted: 12 Oct 2017

See all articles by Aysit Tansel

Aysit Tansel

Middle East Technical University (METU) - Department of Economics; IZA Institute of Labor Economics; Economic Research Forum (ERF)

Antonio Di Paolo

University of Barcelona

Multiple version iconThere are 3 versions of this paper

Date Written: October 12, 2017

Abstract

This paper analyzes the drivers of wage differences among college graduates who hold a degree in a different field of study. We focus on Turkey, an emerging country that is characterized by a sustained expansion of higher education. We estimate conditional wage gaps by field of study using OLS regressions. Average differentials are subsequently decomposed into the contribution of observable characteristics (endowment) and unobservable characteristics (returns). To shed light on distributional wage disparities by field of study, we provide estimates along the unconditional wage distribution by means of RIF-Regressions. Finally, we also decompose the contribution of explained and unexplained factors in accounting for wage gaps along the whole distribution. As such, this is the first work providing evidence on distributional wage differences by college major for a developing country. The results indicate the existence of important wage differences by field of study, which are partly accounted by differences in observable characteristics (especially occupation and, to a lesser extent, employment sector). These pay gaps are also heterogeneous over the unconditional distribution of wages, as is the share of wage differentials that can be attributed to differences in observable characteristics across workers with degrees in different fields of study.

Keywords: Fields of Study, Wage Differentials, Decomposition, Unconditional Wage Distribution, Turkey

JEL Classification: J31, J24, I23, I26

Suggested Citation

Tansel, Aysit and Di Paolo, Antonio, Analyzing Wage Differentials By Fields of Study: Evidence from Turkey (October 12, 2017). XREAP 2017-02, Available at SSRN: https://ssrn.com/abstract=3051880 or http://dx.doi.org/10.2139/ssrn.3051880

Aysit Tansel (Contact Author)

Middle East Technical University (METU) - Department of Economics ( email )

Inonu Bulvari
Ankara 06800
Turkey
90 312 210 2073 (Phone)
90 312 210 7964 (Fax)

IZA Institute of Labor Economics

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

Economic Research Forum (ERF) ( email )

21 Al-Sad Al-Aaly St.
(P.O. Box: 12311)
Dokki, Cairo
Egypt

Antonio Di Paolo

University of Barcelona ( email )

Gran Via de les Corts Catalanes, 585
Barcelona, 08007
Spain

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