Gender Wage Gap: A Semi-Parametric Approach with Sample Selection Correction
CentER Discussion Paper Series No. 2010-16
33 Pages Posted: 19 Feb 2010 Last revised: 2 Mar 2010
There are 2 versions of this paper
Gender Wage Gap: A Semi-Parametric Approach with Sample Selection Correction
Gender Wage Gap: A Semi-Parametric Approach with Sample Selection Correction
Date Written: February 12, 2010
Abstract
Sizeable gender differences in employment rates are observed in many countries. Sample selection into the workforce might therefore be a relevant issue when estimating gender wage gaps. This paper proposes a new semi-parametric estimator of densities in the presence of covariates which incorporates sample selection. We describe a simulation algorithm to implement counterfactual comparisons of densities. The proposed methodology is used to investigate the gender wage gap in Italy. It is found that when sample selection is taken into account gender wage gap widens, especially at the bottom of the wage distribution. Explanations are offered for this empirical finding.
Keywords: gender wage gap, hazard function, sample selection, glass ceiling, sticky floor
JEL Classification: C21, C41, J16, J31, J71
Suggested Citation: Suggested Citation