The Gender Wage Gap and Poverty in Colombia

Abstract

Using 19 years of cross-section wage data, we look at two factors that may explain the lower wages earned by women as compared to men in Colombia. First, we observe a long-term trend towards an increase in the gender wage gap which may be related to new labor regulations giving more protection to women and thereby raising the cost of female employment for firms. Second, as predicted by the literature, we observe an inverse relationship between the relative supply of labor by women and the gender wage gap. The combination of these two factors has led to an increase in the wage gender gap over the period in review, which in turn has led to an increase in relative poverty because less educated women were affected the most by the underlying trends.

Keywords: Labor Supply, Labor Regulations, Gender Wage Gap, Poverty, Colombia

JEL Classification: J31, J71, I32