Tuesday, February 01, 2011

Men,women,earnings

The difference in earnings between men and women is one of the most widely commented on statistics about the labour market. It currently features in notices on the back of some Dublin buses. Fame at last. It is also one of the most widely studied by economists. The public and many commentators tend to focus on the unadjusted difference i.e. not controlling for anything.
Economists, of course, want to control for stuff, hours at least as well as education, experience and so on. There are various techniques for looking at this including the well known Blinder-Oaxaca decomposition. "Controlling" for things assumes they are exogenous and if they are not only offers only a partial explanation at best. For example say the "wage gap conditional on educational" is less than the raw, unadjusted gap: so what? As it happens, females do consistently do better than males educationally so conditioning on that will widen the gap, if anything.
Anyway here is the latest news from the Irish labour market on the male-female earnings difference.

2 comments:

andreasmoser said...

I would think that one of the biggest differences between women and men are their goals in life: How much time they want to spend at work, how much they define themselves through work, the importance of other factors, especially family life.

Kevin Denny said...

Yes indeed. You also tend to find a lot of females in the public sector because even though it is traditionally low paying its more family friendly. It may also be the the case that women are more "pro-social": they take jobs like teaching and nursing because they want to do good and not just do well.