Rising Female Labor Force Participation and Gender Wage Gap: Evidence From Turkey

Abstract

This paper investigates the relation between female activity in the labor market and gender wage gaps using regional data from Turkey. Labor force participation of women in Turkey significantly lags behind the developed countries but is increasing. At the same time, raw gender wage gap is quite low in international standards but also increasing. I use the regional variation to analyze the relation between female labor force participation and wage gaps in two steps. First, I estimate the unexplained wage gap, which filters out the gender differences in productivity characteristics for each region and each year between 2009 and 2018, using Household Labor Force Survey data. Then I analyze the relation between gender gap with female labor force participation and other regional characteristics in a panel data regression. The results of the paper suggest that female labor force participation is positively related with both raw and unexplained wage gap. This positive relation partially stems from the fact that women with less unobservable skills or career motivation enter into labor force in the process of increase in female employment rate.