The Gender Gap: Micro Sources and Macro Consequences
Posted: 23 May 2018
Date Written: April 22, 2018
We investigate the sources of the gender wage gap and its relation to firm heterogeneity. Using the case of Brazil, we document a gender wage gap of 20 log points conditional on education interacted with experience, state, industry, and occupation. Accounting for unobservable worker and firm heterogeneity, we find that around 46 percent of the residual gender wage gap is between firms, while the remainder is within firms. We highlight lower labor market mobility of women relative to men as an important explanatory factor for pay differences both within and between firms. We discuss the consequences of gender gaps for macroeconomic variables including aggregate productivity, employment, and output.
Keywords: Firm Pay Differences, Worker and Employer Heterogeneity, Linked Employer-Employee Data, Income Inequality, Misallocation
JEL Classification: E24, E25, J16, J31, J71
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