Earnings Gap Research Articles

The financial situation before and after first-time psychiatric in-patient diagnosis of schizophrenia spectrum, bipolar, and major depressive disorder

Schizophrenia spectrum, bipolar, and major depressive disorders are severe mental illnesses (SMIs) that not only entail great suffering for those affected but also major societal costs. In this study, I use administrative register data to provide a detailed picture of the financial situation of people with SMI in Sweden during a period of ±10 years around first-time psychiatric in-patient diagnosis of schizophrenia spectrum, bipolar, and major depressive disorders. Receiving a diagnosis was associated with a considerable drop in earnings, which was largely compensated for by social transfers: mainly sickness and disability insurance. However, there were also large and increasing pre-diagnosis earnings gaps, relative to matched comparison groups, especially among those with schizophrenia spectrum disorders. These gaps were to a lesser extent compensated for by social transfers. Consequently, there were permanent and increasing – due to lost earnings growth – income differentials. Hence, findings in previous studies are confirmed: even in an advanced welfare state, people with SMI – especially those with schizophrenia – have an extremely weak position on the labour market and an equally difficult financial situation.

Race and nativity earnings gaps: The role of college networks

We examine the effect of same-race/same-nativity networks on the annual earnings and employment of college students using data from multiple cohorts of students entering a large public college system merged with state unemployment insurance records. We identify network effects from small changes in same-race/same-nativity shares across cohorts within college-majors. White native-born, Black native-born, and Black immigrant students who belong to cohorts with larger shares of same group peers experience higher earnings and employment in the 10 years after college entry. Benefits to Black immigrants are particularly large: a 1 standard deviation increase in the share of peers who are Black immigrants results in an approximate 2 percent increase in annual earnings. Among Hispanic immigrants, the effects of same-group peers on earnings and educational attainment are negative in the years immediately after college entry, while the effects on employment are large and positive. Hispanic native-born students do not receive earnings gains from a larger potential network.

Higher Education and the Black-White Earnings Gap

How does higher education shape the Black-White earnings gap? It may help close the gap if Black youth benefit more from attending and completing college than do White youth. On the other hand, Black college-goers are less likely to complete college relative to White students, and this disparity in degree completion helps reproduce racial inequality. In this study, we use a novel causal decomposition and a debiased machine learning method to isolate, quantify, and explain the equalizing and stratifying roles of college. Analyzing data from the NLSY97, we find that a bachelor’s degree has a strong equalizing effect on earnings among men (albeit not among women); yet, at the population level, this equalizing effect is partly offset by unequal likelihoods of bachelor’s completion between Black and White students. Moreover, a bachelor’s degree narrows the male Black-White earnings gap not by reducing the influence of class background and pre-college academic ability, but by lessening the “unexplained” penalty of being Black in the labor market. To illuminate the policy implications of our findings, we estimate counterfactual earnings gaps under a series of stylized educational interventions. We find that interventions that both boost rates of college attendance and bachelor’s completion and close racial disparities in these transitions can substantially reduce the Black-White earnings gap.

The short run effects of childbirth on parents’ earnings in the Baltics

ABSTRACT Having a child can have a heavy toll on parents' earnings, especially in the first years after childbirth, with mothers often being more affected than fathers. This is particularly true in the three Baltic states, with relatively generous parental leave benefits compared to the EU and norms encouraging mothers to care for children. I carry out an event study to estimate the effect of having a child on the earnings of both genders and find that the earnings of females reduce by half in the first calendar year after childbirth and by 20% to 33% in the second, while male earnings do not change in either period. This results in a widening earnings gap in the Baltics, more so than in several comparison countries (Denmark, Finland, Sweden, the Netherlands, and Norway), in the first two years after the birth of the first child.

Market and home production earnings gaps in Russia

<abstract> <p>This study assesses the evolution of earnings across different groups of workers during Russia's 2000–2013 oil boom and amidst the 2014–2015 oil bust and a trade war. Unconditional quantile regressions and growth incidence curves are applied to nine household surveys for 2000–2016 to estimate earnings gaps across urban/rural, farming/non-farming and gender divides at various earnings quantiles. Gaps in pre-fiscal formal labor market earnings and informal non-market home production are assessed, distinguishing the roles of workers' endowments differentials and returns differentials in production markets. Earning gaps are found to be pervasive, with rural and some female-headed households receiving lower returns on their human capital in part because they lack employment opportunities. Rural Russian households face mobility barriers and lack decent employment opportunities, thus lacking incentives for skill investment. Rural households tend to be less educated and face low returns on their various marketable characteristics. Gender gaps were particularly high historically, particularly among lower quantile groups, but have been steadily falling over the past decade. Growth incidence curves reveal that the 2014 shocks affected particularly harshly the farming and urban households, both immediately and over the following years. We conclude that Russia should strengthen its rural assistance programs and lower the mobility and resettlement barriers to improve rural households' access to education and employment.</p> </abstract>

The Allocation of Immigrant Talent Across Countries: Earnings Gaps

The Allocation of Immigrant Talent Across Countries: Earnings Gaps

Why are exporters more gender-friendly? Evidence from China

Although export orientation has been found in some studies to enlarge the female employment share in firms, the explanatory channels have received limited empirical attention. This paper seeks to fill this gap by studying the link between firm export activity and female employment share using matched employer-employee data from China. We find that the female employment share tends to be larger, and the gender earnings gap tends to be smaller in exporters than in non-exporters after controlling for the characteristics of both the employees and their employers. The channel analysis reveals that exporters’ gender-friendlier behaviors are more likely to be driven by cost-competitive motivations rather than by international laws or the exploitation of gender comparative advantages. Further analysis shows that the production profession, non-SOEs, and firms with lower management efficiency in China tend to be more sensitive to market competition. • We find that exporters tend to hire more females using matched data from China. • The larger share of females goes together with a smaller gender earnings gap. • The channel is that exporters need to be cost-competitive in the foreign market. • Some alternative channels like females' comparative advantage are ruled out. • Our analysis enriches the empirical evidence regarding the channels of interest.

Inequality among the Disadvantaged? Racial/Ethnic Disparities in Earnings among Young Men and Women without a College Education.

Despite the rapid expansion of higher education, many young adults still enter the labor market without a college education. However, little research has focused on racial/ethnic earnings disadvantages faced by non-college-educated youth. We analyze the restricted-use data from the High School Longitudinal Study of 2009 to examine racial/ethnic earnings disparities among non-college-educated young men and women in their early 20s as of 2016, accounting for differences in premarket factors and occupation with an extensive set of controls. Results suggest striking earnings disadvantages for Black men relative to white, Latinx, and Asian men. Compared to white men, Latinx and Asian men do not earn significantly less, yet their earnings likely differ substantially by ethnic origin. While racial/ethnic earnings gaps are less prominent among women than men, women of all racial/ethnic groups have earnings disadvantages compared to white men. The results call for future studies into the heterogeneity within racial/ethnic groups and the intersectionality of race/ethnicity and gender among non-college-educated young adults.

The Persistence of the Gender Earnings Gap: Cohort Trends and the Role of Education in Twelve Countries

Studying twelve countries over 30 years, we examine whether women’s educational expansion has translated into a narrowing of the gender gap in earnings when including persons with zero earnings. As educational attainment is cohort-dependent, an Age-Period-Cohort analysis is most appropriate in our view. Using the micro data from the Luxembourg Income Study (LIS) Database, we show that while, in terms of attainment of tertiary education, women have caught up and often even outperform men, substantial gender differences in our earnings measure persist in all countries. Using the Blinder-Oaxaca decomposition method in an innovative age-period-cohort approach, we demonstrate that the role of education in explaining gender earnings differences has been limited and even decreased over cohorts. We also conclude that, when including persons not receiving earnings, earnings differences at levels far from gender equality will likely persist in the future, even if the “rise of women” in terms of education continues—as the share of women in higher education increases and the returns to education in particular for women declines.

Gender Differential Effects of Technical and Vocational Training: Empirical Evidence for Tanzania

ABSTRACT This article investigates the gender differential effects of technical and vocational education and training (TVET) in Tanzania, using data from the 2014 Integrated Labour Force Survey (ILFS). The multinomial logit model results for employment mobility show that TVET training significantly improves males’ as well as females’ chances of entering into formal employment, while reducing their probability of working in the informal and agriculture sectors or being unemployed. The results further show that although TVET training increases males’ as well as females’ earnings significantly, the returns to TVET training are substantially higher and are more statistically significant for females than for males. The decomposed gender earnings gap using the Oaxaca (1973) and Blinder (1973) decomposition technique revealed that there is a significant gender earning gap in Tanzania; males tend to earn significantly higher incomes than females. The result implies that investing in girls’ education and skills training will play a significant role toward progress in gender equality, poverty eradication, and inclusive economic growth.

From equality to polarization: Changes in urban China’s gender earnings gap from 1988 to 2016

This paper studies the evolution of urban China’s gender earnings gap from 1988 to 2016. We first document that an upward trend in gender inequality started to reverse after 2007 at the median and in the upper part of the earnings distribution but only for workers in the state–owned enterprises (SOEs). Women in the private sector at the top of the earnings distribution did not start to catch up with their male counterparts until 2012. The gender earnings gap at the low end of the distribution, meanwhile, was stuck at a high level after the mid–1990s. Polarization emerges both within the earnings distribution and across ownership types. Following Bayer and Charles (2018), we decompose the change in the gender earnings gap across the whole earnings’ distribution and find that a change in the wage structure dominantly drives the trend in gender inequality. Gender–specific factors, such as discrimination, play a minor role.

Gender-Specific Wage Structure and the Gender Wage Gap in the U.S. Labor Market

This paper challenges the predominant conceptualization of the wage structure as gender-neutral, emphasizing the contribution that this makes to the gender wage gap. Unlike most decomposition analyses, which concentrated on gender differences in productivity-enhancing characteristics (the ‘explained’ portion), we concentrate on the ‘wage structure’ (the ‘unexplained’ portion), which can be defined as the market returns to productivity-enhancing characteristics. These returns are commonly considered a reflection of non-gendered economic forces of supply and demand, and gender differences in these returns are attributed to market failure or measurement error. Using PSID data on working-age employees from 1980 to 2010, we examine gender differences in returns to education and work experience in the U.S. labor market. Based on a threefold decomposition, we estimate the contribution of these differences to the overall pay gap. The results show that men’s returns to education and work experience are higher than women’s; and that in contrast to the well-documented trend of narrowing gender gaps in skills and earnings, the gaps in returns increase over time in men’s favor. Furthermore, the existing gender differences in returns to skills explain a much larger proportion of the gender wage gap than differences in levels of education and experience between men and women. The paper discusses the mechanisms underlying these findings.

How the Great Recession changed class inequality: Evidence from 23 European countries

The question of whether economic recessions increase or decrease the earnings gap between the working and upper-middle class is debated. We study this issue and examine the Great Recession period using two different analytical strategies: three-level multilevel models and multivariate analysis over time. Based on EU Statistics on Income and Living Conditions (EU-SILC) data in 23 countries from 2004 to 2017, our results under both analytical strategies provide robust evidence that, by and large, the Great Recession widened the earnings gap between the working and upper-middle class. The effect magnitude is sizable; an increase of 5 percentage points in the unemployment rate is associated with an increase in the class earnings gap of approximately 0.10 log points.

The Returns to Education and the Determinants of Race and Gender Earnings Gaps Using Self-Reported versus Employer-Reported Earnings Data

There are wide and persistent gender and race differences in wage and salary incomes. Much of the literature attempting to explain these differences relies on self-reported earnings. Many self-reported wages and salary incomes differ, however, from those reported by employers. These errors can bias the measurement of the returns to education and the decomposition of racial and gender earnings gaps. This article examines the implications of using selfreported data for measuring gender and race disparities in earnings. We find that relative to employer-reported data, self-reports understate the wage and salary incomes of black women with low educational levels and overstate the returns to higher education for black women. These previously unexplored and unrecognised findings of bias in the estimation of the returns to black women’s education and the large understatement of earnings among less-well educated black women have implications for interpreting the sources of race and gender earnings inequality.

A closer look at disparities in earnings between white and minoritized dentists.

To examine the factors that account for differences in dentist earnings between White and minoritized dentists. We used data from the American Dental Association's Survey of dental practice, which includes information on 2001-2018 dentist net income, practice ZIP code, patient mix between private and public insurance, and dentist gender, age, and year of dental school graduation. We merged the data on dentist race and ethnicity and school of graduation from the American Dental Association masterfile. Based on practice ZIP code, we also merged the data on local area racial and ethnic composition from the American Community Survey. We used a linear Blinder-Oaxaca decomposition to assess observable characteristics that explain the gap in earnings between White and minoritized dentists. To assess differences in earnings between White and minoritized dentists at different points of the income distribution, we used a re-centered influence function and estimated an unconditional quantile Blinder-Oaxaca decomposition. We extracted data for 22,086 dentists ages 25-85 who worked at least 8 weeks per year and 20 hours per week. Observable characteristics accounted for 58% of the earnings gap between White and Asian dentists, 55% of the gap between White and Hispanic dentists, and 31% of the gap between White and Black dentists. The gap in earnings between White and Asian dentists narrowed at higher quantiles of the income distribution. Compared to other minoritized dentists, Black dentists have the largest earnings disparities relative to White dentists. While the level of the explained component of the disparity for Black dentists is comparable to the explained part of the disparities for other minoritized dentists, the excess percentage of the unexplained component for Black dentists accounts for the additional amount of disparity that Black dentists experienced. Persistent income disparities could discourage minoritized dentists from entering the profession.

Racial and gender inequality regimes in sport: occupational segregation and wage gaps in the U.S. spectator sports industry

ABSTRACT Research question While previous studies of sport industry diversity highlight racial and gender inequalities amongst top management, coaches, and athletes, we lack an understanding of diversity across the broader workforce, particularly amongst lower status and part-time workers. This study examines occupational segregation and wage gaps in the U.S. spectator sports industry, drawing from racialized and gendered organization theories to understand how the industry (re)produces inequality. Research methods Using American Community Survey data, hypothesis tests compared percentages of workers by race, ethnicity, and sex for occupations to percentages of the U.S. population. Regression analyses further examined occupational segregation and earnings differentials by race, ethnicity, and sex, with comparisons to the broader workforce. Results and Findings Results show women and racial minorities are overrepresented in less powerful, lower-earning, and part-time jobs. Large earnings differentials by sex, race, and ethnicity are found across occupations within the sports workforce. Compared to non-sport industries, occupational segregation is greater, and earnings gaps are generally similar or smaller in the sport industry. Implications This research expands understanding of sport industry diversity by highlighting the overrepresentation of women and racial minorities in lower status positions in an industry where white men dominate positions of power. In doing so, it highlights the industry’s operation as an inequality regime, (re)producing inequality through structures and practices.

Earnings Gaps between Native-Born Canadians and Immigrants: The Role of Firms in British Columbia, Ontario, and Quebec

A growing literature shows that earnings differentials are explained in part by the fact that workers from different groups sort differently into high-paying and low-paying firms or are paid differently within the same firm. In this article, we explore whether any differences exist in how those two different channels contribute to earnings differentials between immigrants and native-born Canadians in the provinces of British Columbia, Ontario, and Quebec, which account for more than 80 percent of all immigrants in Canada. We find a surprising degree of similarity across the three provinces in the way in which firms contribute to the immigrant–native-born earnings gap.

New Canadians Working amid a New Normal: Recent Immigrant Wage Penalties in Canada during the COVID-19 Pandemic.

The global coronavirus disease 2019 (COVID-19) pandemic has exposed and arguably intensified many existing inequalities. This analysis explores the relationship between recent immigrant earnings and the pandemic. Specifically, we attempt to empirically answer the question "Has the COVID-19 pandemic exacerbated (or mitigated) recent immigrant-non-immigrant employment and wage gaps?" We find that the pandemic did not change the labour force activity profile of recent or long-term immigrants. Moreover, the pandemic did not disproportionately disadvantage recent immigrants' earnings. In fact, recent immigrant men who were employed during the COVID-19 crisis experienced a small but statistically significant earnings premium. This was insufficient, however, to overcome the overall earnings discount associated with being a recent immigrant. In addition, we find that the recent immigrant COVID-19 earnings boost is observable only at and below the median of the earnings distribution. We also use Heckman selection correction to attempt to adjust for unobserved sample selection into employment during the pandemic. The fact that COVID-19 has not worsened recent immigrant earnings gaps should not overshadow the large, recent immigrant earnings disparities that existed before the pandemic and continue to exist regardless of the COVID-19 crisis.

Gender Wage Gap: Evidence from Employment in Informal Sector

The gender wage gap is still a common phenomenon in many developing countries, especially in the informal sector. As opposed to the formal sector, the gender wage gap seems more adverse in the informal sector, where women are often in unfavourable situations to lessen the substantial wage gap between them and men. This study examined the gender earnings gap from the lower level to the upper level of the wage distribution in informal sector employment using the Indonesian National Labor Survey in 2019. While the Oaxaca-Blinder method only looked at the wage gap from the differences in mean values, this research used the Recentered Influence Function (RIF) to reveal the gaps in the wage distribution. The research found the presence of a weak sticky floor effect across the wage distribution. The gender earnings gap decreased as we moved from the lower wage distribution to the upper wage distribution. Furthermore, the structure effect or unexplained factors contributed to the most prominent share of the gap that forms the wage difference for the entirety of the wage distribution, ranging from 70 per cent. Having examined the individual characteristics, education was found to be the most prominent factor that can help narrow the gap.

How Has the Gender Earnings Gap in Ireland Changed in Thirty Years?

Since 1987, the wages of women in Ireland have been growing faster than those of men. This, coupled with a decrease in the average hours worked by men, has resulted in a reduction in the gender earnings gap in Ireland, most notably at the bottom of the earnings distribution. This paper provides a descriptive analysis of the growth of male and female wages, weekly earnings, and differences in working patterns across the wage and earnings distribution in Ireland over the last three decades, using detailed microdata covering the period 1987–2019. Using a Oaxaca–Blinder decomposition approach, based on unconditional quantile regressions for each time period, we also show how the explained and unexplained components of the gender wage gap have changed across the wage distribution. We find that the mean and median gender gap in earnings fell by one-sixth and one-quarter, respectively, between 1987 and 2019. This change is attributable to the faster growth of women’s wages compared to men’s and some convergence in the average hours worked by men and women. However, there has been relatively stable structural inequality at the top of the wage and earnings distribution over the past three decades, which points towards a persistent glass ceiling in Ireland.