Relative Wages Research Articles

IS TRADE AGAINST OR IN FAVOR OF WOMEN? EMPIRICAL EVIDENCE FROM MANUFACTURING SECTOR IN TURKEY

This paper studies the effect of trade openness on relative wage earnings of female workers in Turkey’s manufacturing sector. We compute the export intensity of a sector by dividing the export value to production value as our measure of trade openness. Using Structure of Earnings Survey data for 2010 and 2014, we estimate the impact of export intensity on the gender wage gap. Our results indicate that a onepercentage point increase in the export intensity of a sector leads to a 0.17 percent higher gender wage gap. We further investigate the trade-gender wage gap link by grouping the sectors into four quartiles according to their export intensities. Our estimations for each quartile reinforce our finding of a negative impact of trade on the male-female wage inequality. Lastly, we analyze how the wage gap between men and women change according to skill levels. In line with the previous findings in the literature, we estimate a higher wage discrimination against high-skill women.

أحكام استحقاق الأجرة عند نقص استيفاء المنافع وتطبيقات معاصرة في الأحكام القضائية دولة الكويت نموذجاً

The research contains a study of the legality of reducing wages in continuous contracts through the provisions of the status of pandemics in Islamic Sharia compared to commercial law in the State of Kuwait. The study also includes discussion about the relationship of wages to benefit and obligation in contracting, and a statement of the theory of emergency conditions, and the consequent obligation to pay the full rent, as happens at the time of closing the shops as a health precaution from the government, to mitigate the spreading the epidemic, and how does the tenant obligate the effects of the contract when he is unable to fully benefit? Especially since the period of precautionary measures has reached for several months, and debts and losses have accumulated on both parties, and judicial rulings have appeared in the court to reduce the rent of the property during the period of government closure, and here the comparison will be made between the provisions of Islamic Sharia, the Commercial Law, and the final rulings on the legality of reducing the rent.

Investigating the role of competing wage opportunities in truck driver occupational choice

AbstractA perceived driver shortage causing difficulty in hiring and retaining qualified drivers threatens carrier productivity and profitability. Logistics literature concerning driver turnover has focused on three primary groups of factors contributing to the driver turnover: driver demographics, manager quality, and work environment. A key consideration, however, is that drivers have an outside option to work in other industry‐occupations. We leverage the Roy model of occupational choice to develop hypotheses regarding the effects of wages and tenure on workers’ occupational choice. To test our theory, we conduct a series of econometric studies on a panel data set we assemble from publicly available data sets. Our results show that relative wages strongly influence the choice of whether to drive a truck for a living. A particularly important finding is that the effect of relative wages varies significantly across industry‐occupations. In fact, contravening industry wisdom that wages are insufficient to attract qualified workers, wage elasticities are greater in trucking than in competing industry‐occupations, such as construction or retail. These results persist after accounting for a wage–tenure interaction. This indicates that the persistent “driver shortage” faced by the industry is the result of wages failing to keep pace with wage increases in competing industry‐occupations.

Trade direction, market access and regional wage inequality: An explanation based on asymmetric trade costs

AbstractWe introduce the trade frictions between wealthy and impoverished regions into the New Economic Geography model. We argue that to reconcile bilateral trade volumes and price data within a standard gravity model, the trade frictions between regions must be systematically asymmetric, with poor regions facing higher costs to export relative to affluent regions. We construct the corresponding econometric model based on the theoretical formulation, and the results show that the asymmetry of trade costs has a significant impact on regional market access and wages. We then argue that these trade frictions are quantitatively crucial and without the asymmetry of trade costs, the standard deviation of market access among Chinese provinces would decline by 13.9%, while that of relative wages would decline by 16.1%.

De-unionization and the wages of essential workers

A definition of essential industries based on recent federal government guidelines is used to trace out the trajectory of wages for essential and nonessential sectors over time in the United States. This retrospective approach is justified by the fact that the included industries provide goods and services that are essential to health and safety whether or not emergency conditions exist. Union density has been consistently higher in essential industries, but the percentage of nonunionized workers has also increased more rapidly in those industries. The data show that real wages in essential industries have declined relative to nonessential industries since 1983 and that essential industries have consistently had lower levels of wage inequality than their nonessential counterparts. Regression analyses suggest that uneven de-unionization can explain part of the decline in relative wages. Furthermore, higher rates of union coverage in essential industries likely contribute to their comparatively low levels of wage inequality.

Why does field of study–occupation mismatch have no effect on wages in Turkish labour markets?

ABSTRACT The Turkish labour market has undergone remarkable changes in the last two decades. An important development is the rising number of university graduates: The aim of this study is to explore whether the Turkish economy has undergone sufficient technological progress to favour more skilled workers, by analysing the effects of skill mismatch on wages in the Turkish labour market. Using three recent Labour Force Surveys from 2014 to 2016, we show that a significant proportion of university graduates are overeducated for their jobs. This descriptive finding in itself would not necessarily indicate a fundamental education-specific mismatch problem, but a transition in labour markets following rapid structural shifts in a developing economy. However, our findings also show that the most suitable jobs for university graduates may not require specialization in any field of study in Turkey. Both findings imply that supply and demand for skilled workers may be in short-term disequilibrium leading to surpluses in different skills in Turkish labour markets consistent with the recent evidence for constant relative real wages for skilled workers.

MAKE YOURSELVES SCARCE: THE EFFECT OF DEMOGRAPHIC CHANGE ON THE RELATIVE WAGES AND EMPLOYMENT RATES OF EXPERIENCED WORKERS

AbstractThis article studies the impact of demographic change on experienced workers' relative wages and employment rates. We investigate empirical predictions from a framework of supply and demand for experience skill, using variation across U.S. local labor markets (LLMs) over the last decades and instrumenting experience skill supply by the LLMs' age structures a decade earlier. We find that aging substantially reduces experienced workers' relative wages and full‐time employment rates, and also their labor market participation rates. Our results imply that the effect of demographic change on labor markets might be more severe than previously recognized, as it reaches beyond wages.

Marcellus Shale Gas Boom and Forestry Employment: Evidence from West Virginia

Abstract Advancement in drilling technology has increased natural gas extraction activities from the Marcellus shale deposit resulting in a shale gas boom in many regions, including West Virginia. This boom has created a significant labor demand shock to local economies experiencing the boom. A number of studies have shown that a shale gas boom directly increases employment and the income of those working in the industry. However, the boom can also have an adverse impact on other sectors through the resource movement effect and intersector labor mobility, pulling workers away from a related sector like forestry. Thus, an econometric model of employment in the forestry sector was developed to investigate the impact of the Marcellus shale gas boom in West Virginia. There is evidence of a labor movement effect with forestry employment negatively affected by the Marcellus shale boom. Specifically, the overall marginal effect of the shale boom on forestry employment is approximately 435 fewer jobs. However, the extent of the decline is slightly moderated by a higher relative wage between gas and forestry, perhaps suggesting diminishing returns and overall slack in the local labor market.

The influence of time, resource, and gender ideology on the division of domestic work in Korea

AbstractThe paper examines how time availability, relative monetary contribution, and gender ideology are related to a couple's contribution to domestic work in South Korea, using data from the Korean Longitudinal Survey of Women and Families. OLS regressions with fixed effects indicate that couples' hours worked were significantly associated with their own and their spouse's time spent on domestic work. The wife's relative wage was another essential determinant in the division of domestic work between wife and husband. Although the wife's gender ideology was not a significant factor for her domestic work time, a husband whose wife had more gender‐equitable attitudes was more likely to devote time to domestic work. Going beyond earlier studies, we also present new evidence for gender display: the wife's relative wage had a curvilinear relationship with the couple's time spent on domestic work. The broader implications of the main findings are also discussed.

Alienating assemblages: Working the carbonscape in times of transformation

Energy geographers seem to agree that the carbon economy represents a symbiotic relationship between social and material components. There is less consensus, however, on how this symbiosis is best conceptualized. We critique the portrayal of carbonscapes as loosely associated, flexibly (re)arranged and easily enacted upon through small-scale radical innovation. Instead, we advocate for a historical materialist approach foregrounding people’s relationship to nature and to each other through the wage relation and systems of social reproduction. By assuming the vantage point of petroleum workers, we show how geographies of (de)alienation can inform a politics of reconnection in the carbon economy.

GRAHAM’S THEORY OF INTERNATIONAL VALUES REVISITED: A RICARDIAN TRADE MODEL WITH LINK COMMODITIES

Frank D. Graham (1890–1949) presented an innovative multi-country, multi-commodity trade model that attached great importance to link commodities and quantity adjustments, not perfect specializations and price adjustments as emphasized by John Stuart Mill and Alfred Marshall. However, due to some shortcomings, this model was not sufficiently understood and has been forgotten. This study reconstructs Graham’s theory of international values by rectifying the shortcomings. Through this reconstruction, the following is clarified. First, in multi-country, multi-commodity trade models, the existence of link commodities is general and perfect specializations seldom appear; therefore, quantity adjustments are normally performed in the face of demand shifts. Second, notwithstanding unchanging sectoral productivity at a national level, national wage rates can vary greatly according to the patterns of the international division of labor. Third, while the domestic relative wage rate increases with an increase in a home country’s productivity of link commodities, it does not increase with an increase in the productivity of commodities produced only in the home country.

Services Trade: The Great Gender Equaliser?

Standing at 24% in 2018, India’s female labour force participation is only half of the global average (48%). At the same time, India has one of the widest gender wage gaps in the world and women are less likely to be employed in the formal sector compared to men. This article focuses on how international trade affects relative wages and formal employment between men and women in India. Using the Revealed Symmetrical Comparative Advantage index, sectors of comparative advantage and disadvantage are identified and matched to Indian labour force surveys that contain information on sectoral employment and earnings. We find that sectors of comparative advantage in services have the lowest gender wage gap, with women earning 24% less than their male counterparts, while women in manufacturing earned on average 40% less than male workers. Using the Oaxaca–Blinder decomposition, we find that the total gender wage gap in sectors of comparative advantage in services are minor while it is quite substantial in manufacturing, regardless of comparative advantage status. The article concludes that services trade goes hand in hand with a smaller gender wage gap as women leverage their skills better in services than in manufacturing. JEL Codes: F16, F14

JobKeeper: The Australian Short‐Time Work Program

AbstractJobKeeper is a short‐time work subsidy implemented between March 2020 and March 2021 in Australia during the COVID‐19 pandemic to reinforce the resilience of the labour market. As a job retention (JR) program, JobKeeper supports businesses, protects jobs and employment relationships and secures income of Australian workers. Drawing on microeconomic and macroeconomic evaluations of the JR programs published in other countries in a pre‐pandemic period, this paper studies how the generosity, responsiveness, governance and eligibility criteria of JobKeeper may shape its efficiency and equity. We show that expected benefits of JobKeeper may be limited by some negative economic effects of short‐time work subsidies. Locking employees in their current position potentially crowds out more efficient matches on the labour market. These displacement effects may slow down economic recovery. As a wage subsidy, JobKeeper distorts the relative wage and employment prospects between eligible and non‐eligible workers. These substitution effects can increase the dualization of the Australian labour market and institutionalise lay‐offs inequities for workers holding a temporary visa. Finally, we argue that subsidies for part‐time work also generate incentives for working time reorganisations that should be evaluated.

Lowering Standards to Wed? Spouse Quality, Marriage, and Labor Market Responses to the Gender Wage Gap

Abstract This paper examines the effect of the female-to-male wage ratio, “relative wage,” on women's spouse quality, marriage, and labor supply over three decades. Exploiting task-based demand shifts as a shock to relative pay, I find that a higher relative wage (a) increases the quality of women's mates, as measured by higher spousal education; (b) reduces marriage without substitution to cohabitation; and (c) raises women's hours of work. These effects are consistent with a model in which a higher relative wage increases the minimum nonpecuniary benefits (“quality”) women require from a spouse and therefore reduce marriage among low-quality husbands.

Capitalist Accumulation, Contradictions and Crisis in China, 1995–2015

Drawing upon Marxian and regulation theory, this article seeks to identify key dynamics and contradictions of capitalist accumulation in China between 1995 and 2015 and to explain these in their institutional context. To this end, data from national accounts and input-output tables is re-mapped to estimate Marxian categories such as the rates of surplus value and profit. The article demonstrateshow the transformation of the wage relation and an increase in the rate of surplus value lie at the core of a predominantly extensive accumulation regime that enabled rapid and uncoordinated growth facilitated by world market integration. In the wake of the global crisis, however, a confluence of contradictions has led to over-accumulation and a decline in profitability, clear symptoms of exhaustion of the accumulation regime that explain the current slowdown under the “New Normal.” The underlying contradictions are rooted in the institutional context of the “Socialist Market Economy,” but especially in the wage relation, which no longer supports sufficient increases in the rate of surplus value or a regular pace of accumulation.

China's Rebalancing and Gender Inequality

This paper examines gender inequality in the context of structural transformation and rebalancing in China. We document declining women's relative wages and labor force participation in China during the last two decades, despite rapid growth and expansion of the service sector. Using household data, we provide evidence consistent with a U-shaped relationship between economic development and women's labor market outcomes. Using a model of structural transformation, we show that labor market barriers for women have increased over time. Model counterfactuals suggest that removing these barriers and increasing service sector productivity can boost both gender equality and economic growth in China.

Offshoring and sequential production chains: A general equilibrium analysis

AbstractWe present a two‐region general equilibrium model in which firms exploit international wage differences by offshoring parts of the production process. Firms have to take into account that production steps follow a strict sequence and that transporting intermediate goods across borders is costly. We analyze how a change in transport costs affects offshoring patterns as well as factor prices, accounting for the general equilibrium effects of firms’ decisions. As we demonstrate, a decline in transport costs is likely to have a non‐monotonic influence on relative wages and on the volume of offshoring depending on the emergence of different firm types, with domestic wages first decreasing as lower transport costs induce firms to perform large parts of the production chain abroad and then increasing as even lower transport costs provide an incentive to select the lowest‐cost location for each production step.

Do women face a glass ceiling at home? The division of household labor among dual-earner couples

In this paper, we use data on mixed-gender dual-earner couples in Southern and Western Europe to investigate how the division of unpaid household labor within mixed-gender couples varies depending on the ratio of the partners’ market wages. From analysis of the EU Statistics on Income and Living Conditions, we first show that married or cohabiting women do twice as much household work as single women with the same income. Furthermore, women’s time spent in home production does not vary in relation to the couple’s relative wages in Southern Europe. We find a positive elasticity of substitution between male and female labor in home production with respect to their relative within-couple wages in Western Europe. Our identification is based on predicting each country’s wage distributions within gender-specific cells defined by age group and education using distributions in all the other countries. We present a positive evidence for presence of a “second-shift” that women face especially in Southern Europe, which may stem from regional gender norms.

Organization of remuneration in construction industry

The article explains the need of changing the approach to the calculation of a subsistence level and its influence on remuneration in construction. In connection with the consideration of the issue of the correction of defining a subsistence level judging by the median wage in the country at the meeting of the Government of the Russian Federation, the authors analysed the indicators of costing and actual wages in the construction industry by the example of the Irkutsk region. The analysis revealed an urgent need in increasing the amount of labour remuneration the today amount of which does not correspond to the Federal industrial agreement on construction and industry of construction materials of the Russian Federation. The article shows the result of the analysis for construction wages change at the estimation using the median wages in relation to an “absolute” principle for calculating a subsistence level. The authors show that such an increase is possible only in case of preserving the rules for wage calculation in the new industrial agreement on construction and industry of construction materials in the Russian Federation in 2021.

A special fund for gender equality? Institutional constraints and gendered consequences in Swedish collective bargaining

AbstractSweden is often described as one of the world's most gender‐equal societies, but the gender pay gap nevertheless remains large. In 2007, a special gender‐equality fund that targeted women workers was successfully implemented in the collective bargaining agreement. Although it decreased the gender pay gap, it was controversial and has never been employed since. The aim of this article is to increase knowledge concerning the conditions for such “gender‐equality bargaining” through a detailed empirical case study. An in‐depth study of the bargaining process casts light on how the institutional features of bargaining have changed after 2007 in a way that significantly restricts further attempts to make relative wage changes in gender‐segregated labor markets. The findings indicate that increased employer coordination and a strong industry norm appear to hinder gender‐equality initiatives.