Glass ceiling or sticky floor? Examining the gender earnings differential across the earnings distribution in urban China, 1987–2004

Abstract

Using 1987, 1996, and 2004 data, we show that the gender earnings differential in the Chinese urban labor market has increased across the earnings distribution, and the increase was greater at the lower quantiles. We interpret this as evidence of the stronger “sticky floor” effect. We use the reweighting and recentered influence function regression methods proposed by Firpo, Fortin, Lemieux to decompose gender earnings differentials across the earnings distribution [Firpo, S., Fortin, N.M., Lemieux, T., 2007a. Unconditional quantile regressions. Technical working paper No. 339, NBER; Firpo, S., Fortin, N.M., Lemieux, T., 2007b. Decomposing wage distributions using influence function projections. Working paper. Department of Economics, University of British Columbia]. We find that gender differences in the return to labor market characteristics, also known as the “discrimination effect” or “unexplained gender pay gap,” contribute more to the increase in the overall gender earnings differential than do the gender endowment differences. The Firpo et al. method allows us to further decompose the gender earnings gap into the contribution of each individual variable. We find that the “sticky floor” effect may be associated with a particularly low paid group of female production workers with relatively low education working in non-state owned enterprises. Journal of Comparative Economics 36 (2) (2008) 243–263.