What is the Role of Firm-Specific Pay Policies on the Gender Earnings Gap in Canada?

48 Pages Posted: 7 Dec 2020

See all articles by Jiang Li

Jiang Li

Statistics Canada

Benoit Dostie

HEC Montreal - Institute of Applied Economics; IZA Institute of Labor Economics

Gaëlle Simard-Duplain

affiliation not provided to SSRN

Abstract

Using data from the Canadian Employer-Employee Dynamics Database between 2001 and 2015, we examine the impact of firms' hiring and pay-setting policies on the gender earnings gap in Canada. Consistent with the existing literature and following Card, Cardoso, and Kline (2016), we find that firm-specific premiums explain nearly one quarter of the 26.8% average earnings gap between female and male workers. On average, firms' hiring practices – due to difference in the relative proportion of women hired at high-wage firms, or sorting – and pay-setting policies – due to differences in pay by gender within similar firms – each explain about one half of this firm effect. The compositional difference between the two channels varies substantially over the life-cycle, by parental and marital status, and across provinces.

JEL Classification: J16, J31, J51, J71

Suggested Citation

Li, Jiang and Dostie, Benoit and Simard-Duplain, Gaëlle, What is the Role of Firm-Specific Pay Policies on the Gender Earnings Gap in Canada?. IZA Discussion Paper No. 13907, Available at SSRN: https://ssrn.com/abstract=3743131

Jiang Li

Statistics Canada

Ottawa, Ontario
Canada

Benoit Dostie (Contact Author)

HEC Montreal - Institute of Applied Economics ( email )

3000, ch. de la Côte-Ste-Catherine
Montréal, Quebec H3T 2A7
Canada
514-340-6453 (Phone)
514-340-6469 (Fax)

HOME PAGE: http://www.hec.ca/profs/benoit.dostie.html

IZA Institute of Labor Economics

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

Gaëlle Simard-Duplain

affiliation not provided to SSRN

No Address Available

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
15
Abstract Views
44
PlumX Metrics