Employment Equality Policy and Gender Gap in Labor Market

Abstract

Using published official data and survey data, we review the trends of the gender wage gap and investigate the determinants of the gender wage gap in China and Japan based on the Blinder-Oaxaca decomposition methods. Two main conclusions can be drawn. First, although the Chinese government enacted equal employment opportunity policies during the market-oriented reform period, the gender wage gap widened between the 1980s and 2010s. The decomposition results indicate that the contribution rate of the factor price component is greater than that of the endowment component during the period of 1988–2013. The decomposition results based on the latest survey data conducted in 2019 also confirm these conclusions. Second, in Japan, the gender wage gap has narrowed over the long term (1976–2017). The endowment components significantly contribute to a reduction in the gender wage gap. However, the change is caused by the change in the endowment of women themselves rather than the relative change in gender endowment difference. Additionally, after 2000, the factor price component also contributed to a reduction in the gender wage gap. The results indicate that, drawing from the Japanese experience, the enforcement of equal employment and family-friendly policies is imperative to reduce the gender wage gap in China.