Ethnic and Gender Wage Disparities in Sri Lanka

24 Pages Posted: 26 Jul 2002

See all articles by Mohamed Ihsan Ajwad

Mohamed Ihsan Ajwad

World Bank - Human Development

Pradeep Kurukulasuriya

United Nations Development Programme; Yale University - School of Forestry and Environmental Studies

Date Written: June 2002


Ajwad and Kurukulasuriya examine wage inequalities in Sri Lanka's formal sector using data from the Sri Lanka Integrated Survey 1999-2000. The study aims to:

• Investigate whether the labor market is characterized by wage disparities among ethnic and gender groups.

• Identify the determinants of wages and the factors that affect the wage differential.

• Analyze the determinants of wages across the conditional wage distribution.

• Disaggregate the ethnic or gender wage disparities where observed into a component affected by the endowment of productive characteristics, as well as a component affected by the returns to those productive characteristics in the labor market.

The authors find that ethnicity is not a significant determinant of wages. The result is robust to different specifications. In addition, ethnicity is not significant in any of the conditional quantiles estimated.

However, there is gender disparity in wage rates in Sri Lanka. The magnitude of this disparity varies depending on the worker's ethnicity. This gender wage disparity varies by about 10 percent for Tamils and 48 percent among other ethnicities. In addition, the authors find that much of the gender disparity is not explained by productive characteristics, implying that discrimination against women may play a role. The quantile regression estimates indicate that the premium paid to male workers in the labor force is more pronounced in the upper conditional wage rate distribution.

This paper is a product of the Economic Policy Division, Poverty Reduction and Economic Management Network. The authors may be contacted at or pradeep.

JEL Classification: J3, J7, J15, J16

Suggested Citation

Ajwad, Mohamed Ihsan and Kurukulasuriya, Pradeep, Ethnic and Gender Wage Disparities in Sri Lanka (June 2002). World Bank Policy Research Division Working Paper No. 2859. Available at SSRN:

Mohamed Ihsan Ajwad (Contact Author)

World Bank - Human Development ( email )

1818 H Street, N.W.
Washington, DC 20433
United States
202-473-7861 (Phone)

Pradeep Kurukulasuriya

United Nations Development Programme ( email )

New York, NY 10017
United States
2129066843 (Phone)

Yale University - School of Forestry and Environmental Studies ( email )

New Haven, CT 06511
United States

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