Gender wage gap (adjusted for individual characteristics) as a phenomenon means that women are paid unjustifiably less than men, i.e. below their productivity. Meanwhile, efficiency wages as a phenomenon mean that a group of workers is paid in excess of productivity. However, productivity is typically unobservable, hence it is proxied by some observable characteristics. If efficiency wages are effective only in selected occupations and/or industries, and these happen to be dominated by men, measures of adjusted gender wage gaps will confound (possibly) below productivity compensating of women with above productivity efficiency wage prevalence. We propose to utilize endogenous switching models to estimate adjusted gender wage gaps. We find that without correction for the prevalence of efficiency wages, the estimates of the adjusted gender wage gaps tend to be substantially inflated.
Kate is an Assistant Professor at Warsaw School of Economics and she joined us to work on inequality projects. Kate is an econometrician, fresh holder of a PhD degree from the University of Southampton, UK. Her main research interests are nonparametric econometrics, endogeneity and partial identification.
Kasia jest adiunktem w Szkole Głównej Handlowej a z GRAPE współpracuje w badaniu nierówności. Kasia jest ekonometrykiem, doktorat zrobiła na University of Southampton, a jej zainteresowania to teoria ekonometrii, ekonometria szeregów czasowych i metody nieparametryczne.