Working Paper: CEPR ID: DP18136
Authors: Alba Couceiro de León; Juan J. Dolado
Abstract: This paper updates the available evidence on the public-private wage gap in Spain, which dates back to 2012. Through microdata drawn from the last three waves of the Wage StructureSurvey (2010, 2014 and 2018) we study how this gap and its distribution by gender and education have evolved during and after the Great Recession. Conventional Oaxaca-Blinder decompositionsare used to divide the raw wage gap into a component explained by differences in characteristics and another one capturing differences in returns and endogenous selection. The main findings are: (i) a strong wage compression by skills, and (ii) a wage premium for less-skilled women in the public sector. Both empirical results can be rationalised by a monopoly-union wage setting model with monopsonistic features and the presence of female statistical discrimination
Keywords: Public Sector; Private Sector; Monopsony; Unions
JEL Codes: J31; J38; J42; J45
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| public sector employment (J45) | public sector wage premium (J45) |
| unexplained component of wage gap (J79) | public-private wage differential (J31) |
| sector employment (L89) | wage distribution (J31) |
| lower-skilled public employees (J45) | higher wages compared to private sector counterparts (J45) |
| higher-skilled employees (J24) | lower wages compared to public sector counterparts (J45) |
| public sector employment (J45) | wage penalty mitigation for less-skilled women (J79) |
| gender disparities in wage outcomes (J79) | sectoral employment (J68) |