This paper addresses the issue of the gender pay gap in the formal and informal labour markets in Poland. The authors verify the hypothesis of the existence of a gender pay gap in informal work and compare this gap with the one observed in the formal (registered) labour market.
Various analyses of available data show that size and characteristics of gender pay gap differ depending on the level of earnings. The inequality of earnings among unregistered women and men is more pronounced at the bottom tail of the earnings distribution. In the case of formal employees, inequality at the top of the distribution tends to be larger, confirming the existence of a ‘glass ceiling’.
The decomposition of the gender pay gap for selected quintiles indicates that it would be even higher if women had men’s characteristics.
A possible explanation of the results is the lack of minimum wage regulations in the informal market and the greater flexibility in agreement on wages in the higher quantiles.
Authored by: Magdalena Rokicka and Anna Ruzik-Sierdzinska
Published in 2010
This work is done as contribution to the Regional Human Development Report 2004 section 3.7 on “Labor Markets”. The paper focuses on discussing peculiarities of the labor market transition in CIS countries, features of unemployment, labor legislation, and role of the trade unions.
The paper gathers information on the labor markets of CIS and Eastern European countries that was available by summer 2004, and draws policy recommendations based on comparison between these two groups of countries. The main conclusion is that the transformation of labor markets is not complete in any of the CIS countries; most of the problems that prevailed in the early 1990s remain. These include: centralized wage setting in five CIS countries – Belarus, Moldova, Tajikistan, Turkmenistan, and Uzbekistan; extensive unemployment and underemployment, much of which is hidden; ineffective systems of labor relations and social protection; large mismatches between the labor market skills supplied and the skills demanded by new market economies; inadequate official labor market data.
Fortunately, the strong economic growth experienced by most CIS countries since 1999 has increased the demand for labor and is putting downward pressures on unemployment rates. This offers a window of opportunity for policy makers seeking to further transform labor markets, and to modernize labor relations and social protection systems. The above analysis suggests the policy recommendations to speed up further transformation.
Authored by: Olga Pavlova, Oleksandr Rohozynsky
Published in 2005
The growth and scale of informal employment in many developing countries has been traditionally attributed to the displacement of workers into insecure forms of labour market attachment as the only feasible alternative to unemployment (Fields, 1975; Mazumdar, 1976). More recently a number of authors (Pradhan and van Soest, 1995, 1997; Cohen and House, 1996; Marcoullier et al., 1997; Maloney, 1999; Saavedra and Chong, 1999; Gong and van Soest, 2002) question this interpretation of informality, by calling into doubt the idea that the existence of informal and formal sectors is a manifestation of “dualism” in the labour market.
A further strand of research has highlighted the dynamic “micro-entrepreneurial” nature of informal economic activity (Cunningham and Maloney, 2001; Maloney, 2004; Pisani and Pagan, 2004). This view of informality is well-established and can be traced back to the work of Hart (1972). A final view (and one which we do not address in the present paper) concerns the relationship between informality and illegal or tax-evading activity (see Gerxhani, 2004, and Loayza et al., 2005). Each of these alternative views shares in common the idea that informal activity may be freely chosen by some workers.
These individuals either perceive state social protection to be poor “value for money” or do not wish to have the conditions of their employment relationship (such as hours of work) restricted by tight state labour market regulation. Alternatively, they may be attracted by the prospective job satisfaction or income stream associated with a successful transition into entrepreneurship, or may perceive the relative benefits of illegal or unregistered activity to outweigh the risks of detection.
The size of the informal sector is of particular interest to economic policy makers concerned to promote the development of a micro-entrepreneurial sector. This concern arises because of its perceived contribution to dynamic economic efficiency, possibly as a response to growing competitive pressures brought about by trade liberalization.
On the other hand policy makers may be concerned that significant numbers, perhaps even a majority of workers in developing countries have little or no social security provision. This means that they have little on which to fall back in the event of illness, unemployment or old age, beyond personal wealth and extended family support. A narrower but nevertheless important concern may be to reduce informality in order to widen the base of direct taxation.
This discussion of alternative perspectives on informality brings into sharp focus the question of the most appropriate way to define and measure the informal sector. This is a question which has attracted little or no detailed attention in the literature. The purpose of the present paper is to attempt to redress this. This lack of attention may arise from the paucity of data on a sector which by its nature is problematic to define.
This document summarizes a research paper that analyzes the performance of foreign subsidiaries in Poland compared to domestic firms. The paper uses firm-level panel data from Polish manufacturing to estimate differences in total factor productivity, labor productivity, employment growth, markups, and profitability between foreign and domestic firms. The analysis aims to disentangle the direct effects of foreign ownership from indirect spillover and competition effects. Regression results suggest that foreign subsidiaries pay more in wages and capital, earn less in profitability, but have higher total factor productivity and labor productivity than domestic firms. Foreign ownership also contributes to higher employment growth. There is little evidence that foreign firms have reduced market efficiency through increased markups on average. When controlling for competition
This document provides a literature review on analyzing gender gaps. It discusses how gender gaps can be examined across different dimensions like labor participation, economic opportunity, political empowerment, education, and health. It outlines factors that can explain gender gaps like social norms, cultural environments, and psychological differences between males and females. The document also discusses how reducing gender inequality can promote sustainable development and economic growth. Finally, it reviews several approaches used to measure gender gaps developed by organizations like the UNDP, OECD, World Bank, and World Economic Forum.
This document summarizes research on the relationship between innovation, employment, and wages in Poland using data from Polish companies from 2004-2006 and the Polish Labour Force Survey from the same period. The research examines three dimensions: 1) the relationship between innovation and job creation, finding a weak but positive relationship; 2) the effect of innovation on employment skills structure, finding no significant effect; and 3) the relationship between innovation and wages, finding innovation positively impacts wages of skilled workers and negatively impacts wages of unskilled workers, indicating skill-biased wage changes. The results provide initial evidence that innovation in Poland impacts employment and wages in a manner consistent with skill-biased technical change theory.
The Orange Revolution in the fall of 2004 built great hopes for a better future for Ukraine. However, three years later those hopes have been replaced by disappointment, frustration and confusion. Although progress in the areas of political freedom, pluralism, civil rights and freedom in the media remains unquestionable the record of economic, institutional and legal reforms is much more problematic. The key macroeconomic indicators are not better than they were few years ago and the business climate has barely improved. The WTO accession process remains incomplete. The perspectives of Euro-Atlantic integration are continually subject to heated domestic political controversies. The political situation remains unstable, mostly due to the hasty constitutional changes that were adopted during the Orange Revolution.
The purpose of this paper is to analyze the state of the Ukrainian economy at the end of 2007 and reflect upon what kind of reform program the Ukrainian government should consider, regardless of its political color. The reforms suggested in this paper involve a broad agenda of macroeconomic, social, structural and institutional measures. This agenda goes beyond the purely economic sphere and also addresses issues of legal, administrative and political reforms. The politics and political economy of any future reform effort will not be easy because the country is deeply divided in political, cultural, regional and ethnic terms. In such an environment, crucial reforms and strategic decisions will require a wider cross-party political consensus.
Authored by: Marek Dąbrowski
Published in 2007
This paper investigates the differences in innovation behaviour, i.e. differences in innovation sources and innovation effects, among manufacturing firms in three NMS: the Czech Republic, Hungary and Poland. It is based on a survey of firms operating in four manufacturing industries: food and beverages, automotive, pharmaceuticals and electronics. The paper takes into account: innovation inputs in enterprises, cooperation among firms in R&D activities, the benefits of cooperation with business partners and innovation effects (innovation outputs and international competitiveness of firms' products and technology) in the three countries. After employing cluster analysis, five types of innovation patterns were detected. The paper characterises and compares these innovation patterns, highlighting differences and similarities. The paper shows that external knowledge plays an important role in innovation activities in NMS firms. The ability to explore cooperation with business partners and the benefits of using external knowledge are determined by in-house innovation activities, notably R&D intensity.
Authored by: Ewa Balcerowicz, Marek Pęczkowski, Anna Wziatek-Kubiak
Published in 2009
This paper addresses the issue of household demand for services in Poland when informal sector is taken into consideration. The aim of the study is threefold: (i) to investigate the factors influencing households expenses for services, (ii) to find the determinants of households’ tax strategy (choice between acquiring services on regular labour market or not), (iii) to investigate the differences between the factors that influence the expenses for formal versus informal services. Two-step Heckman selection model is used to account for the selection into buying household services. Lee’s (1983) procedure is adopted to control for the selection into the particular choice of tax strategy when purchasing household services. The decision whether to buy household services and whether formally or informally is modelled as a sequential choice and estimated by bivariate probit with selection. An important novel feature of the model used is the inclusion of variables that capture social
norms and personal attitudes toward tax evasion. The study concludes that factors influencing expenses for services are positively related to financial situation of households, education and age of household head. The probability of avoiding taxes is higher for lower income households, households with more than one member and for those where a positive attitude toward informal employment is expressed. The impact of determinants of expenses for formal and informal services separately is comparable. Only household structure has the opposite effect on expenses for formal services versus informal ones.
Authored by Izabela Styczynska
Published in 2012
This work is done as contribution to the Regional Human Development Report 2004 section 3.7 on “Labor Markets”. The paper focuses on discussing peculiarities of the labor market transition in CIS countries, features of unemployment, labor legislation, and role of the trade unions.
The paper gathers information on the labor markets of CIS and Eastern European countries that was available by summer 2004, and draws policy recommendations based on comparison between these two groups of countries. The main conclusion is that the transformation of labor markets is not complete in any of the CIS countries; most of the problems that prevailed in the early 1990s remain. These include: centralized wage setting in five CIS countries – Belarus, Moldova, Tajikistan, Turkmenistan, and Uzbekistan; extensive unemployment and underemployment, much of which is hidden; ineffective systems of labor relations and social protection; large mismatches between the labor market skills supplied and the skills demanded by new market economies; inadequate official labor market data.
Fortunately, the strong economic growth experienced by most CIS countries since 1999 has increased the demand for labor and is putting downward pressures on unemployment rates. This offers a window of opportunity for policy makers seeking to further transform labor markets, and to modernize labor relations and social protection systems. The above analysis suggests the policy recommendations to speed up further transformation.
Authored by: Olga Pavlova, Oleksandr Rohozynsky
Published in 2005
The growth and scale of informal employment in many developing countries has been traditionally attributed to the displacement of workers into insecure forms of labour market attachment as the only feasible alternative to unemployment (Fields, 1975; Mazumdar, 1976). More recently a number of authors (Pradhan and van Soest, 1995, 1997; Cohen and House, 1996; Marcoullier et al., 1997; Maloney, 1999; Saavedra and Chong, 1999; Gong and van Soest, 2002) question this interpretation of informality, by calling into doubt the idea that the existence of informal and formal sectors is a manifestation of “dualism” in the labour market.
A further strand of research has highlighted the dynamic “micro-entrepreneurial” nature of informal economic activity (Cunningham and Maloney, 2001; Maloney, 2004; Pisani and Pagan, 2004). This view of informality is well-established and can be traced back to the work of Hart (1972). A final view (and one which we do not address in the present paper) concerns the relationship between informality and illegal or tax-evading activity (see Gerxhani, 2004, and Loayza et al., 2005). Each of these alternative views shares in common the idea that informal activity may be freely chosen by some workers.
These individuals either perceive state social protection to be poor “value for money” or do not wish to have the conditions of their employment relationship (such as hours of work) restricted by tight state labour market regulation. Alternatively, they may be attracted by the prospective job satisfaction or income stream associated with a successful transition into entrepreneurship, or may perceive the relative benefits of illegal or unregistered activity to outweigh the risks of detection.
The size of the informal sector is of particular interest to economic policy makers concerned to promote the development of a micro-entrepreneurial sector. This concern arises because of its perceived contribution to dynamic economic efficiency, possibly as a response to growing competitive pressures brought about by trade liberalization.
On the other hand policy makers may be concerned that significant numbers, perhaps even a majority of workers in developing countries have little or no social security provision. This means that they have little on which to fall back in the event of illness, unemployment or old age, beyond personal wealth and extended family support. A narrower but nevertheless important concern may be to reduce informality in order to widen the base of direct taxation.
This discussion of alternative perspectives on informality brings into sharp focus the question of the most appropriate way to define and measure the informal sector. This is a question which has attracted little or no detailed attention in the literature. The purpose of the present paper is to attempt to redress this. This lack of attention may arise from the paucity of data on a sector which by its nature is problematic to define.
This document summarizes a research paper that analyzes the performance of foreign subsidiaries in Poland compared to domestic firms. The paper uses firm-level panel data from Polish manufacturing to estimate differences in total factor productivity, labor productivity, employment growth, markups, and profitability between foreign and domestic firms. The analysis aims to disentangle the direct effects of foreign ownership from indirect spillover and competition effects. Regression results suggest that foreign subsidiaries pay more in wages and capital, earn less in profitability, but have higher total factor productivity and labor productivity than domestic firms. Foreign ownership also contributes to higher employment growth. There is little evidence that foreign firms have reduced market efficiency through increased markups on average. When controlling for competition
This document provides a literature review on analyzing gender gaps. It discusses how gender gaps can be examined across different dimensions like labor participation, economic opportunity, political empowerment, education, and health. It outlines factors that can explain gender gaps like social norms, cultural environments, and psychological differences between males and females. The document also discusses how reducing gender inequality can promote sustainable development and economic growth. Finally, it reviews several approaches used to measure gender gaps developed by organizations like the UNDP, OECD, World Bank, and World Economic Forum.
This document summarizes research on the relationship between innovation, employment, and wages in Poland using data from Polish companies from 2004-2006 and the Polish Labour Force Survey from the same period. The research examines three dimensions: 1) the relationship between innovation and job creation, finding a weak but positive relationship; 2) the effect of innovation on employment skills structure, finding no significant effect; and 3) the relationship between innovation and wages, finding innovation positively impacts wages of skilled workers and negatively impacts wages of unskilled workers, indicating skill-biased wage changes. The results provide initial evidence that innovation in Poland impacts employment and wages in a manner consistent with skill-biased technical change theory.
The Orange Revolution in the fall of 2004 built great hopes for a better future for Ukraine. However, three years later those hopes have been replaced by disappointment, frustration and confusion. Although progress in the areas of political freedom, pluralism, civil rights and freedom in the media remains unquestionable the record of economic, institutional and legal reforms is much more problematic. The key macroeconomic indicators are not better than they were few years ago and the business climate has barely improved. The WTO accession process remains incomplete. The perspectives of Euro-Atlantic integration are continually subject to heated domestic political controversies. The political situation remains unstable, mostly due to the hasty constitutional changes that were adopted during the Orange Revolution.
The purpose of this paper is to analyze the state of the Ukrainian economy at the end of 2007 and reflect upon what kind of reform program the Ukrainian government should consider, regardless of its political color. The reforms suggested in this paper involve a broad agenda of macroeconomic, social, structural and institutional measures. This agenda goes beyond the purely economic sphere and also addresses issues of legal, administrative and political reforms. The politics and political economy of any future reform effort will not be easy because the country is deeply divided in political, cultural, regional and ethnic terms. In such an environment, crucial reforms and strategic decisions will require a wider cross-party political consensus.
Authored by: Marek Dąbrowski
Published in 2007
This paper investigates the differences in innovation behaviour, i.e. differences in innovation sources and innovation effects, among manufacturing firms in three NMS: the Czech Republic, Hungary and Poland. It is based on a survey of firms operating in four manufacturing industries: food and beverages, automotive, pharmaceuticals and electronics. The paper takes into account: innovation inputs in enterprises, cooperation among firms in R&D activities, the benefits of cooperation with business partners and innovation effects (innovation outputs and international competitiveness of firms' products and technology) in the three countries. After employing cluster analysis, five types of innovation patterns were detected. The paper characterises and compares these innovation patterns, highlighting differences and similarities. The paper shows that external knowledge plays an important role in innovation activities in NMS firms. The ability to explore cooperation with business partners and the benefits of using external knowledge are determined by in-house innovation activities, notably R&D intensity.
Authored by: Ewa Balcerowicz, Marek Pęczkowski, Anna Wziatek-Kubiak
Published in 2009
This paper addresses the issue of household demand for services in Poland when informal sector is taken into consideration. The aim of the study is threefold: (i) to investigate the factors influencing households expenses for services, (ii) to find the determinants of households’ tax strategy (choice between acquiring services on regular labour market or not), (iii) to investigate the differences between the factors that influence the expenses for formal versus informal services. Two-step Heckman selection model is used to account for the selection into buying household services. Lee’s (1983) procedure is adopted to control for the selection into the particular choice of tax strategy when purchasing household services. The decision whether to buy household services and whether formally or informally is modelled as a sequential choice and estimated by bivariate probit with selection. An important novel feature of the model used is the inclusion of variables that capture social
norms and personal attitudes toward tax evasion. The study concludes that factors influencing expenses for services are positively related to financial situation of households, education and age of household head. The probability of avoiding taxes is higher for lower income households, households with more than one member and for those where a positive attitude toward informal employment is expressed. The impact of determinants of expenses for formal and informal services separately is comparable. Only household structure has the opposite effect on expenses for formal services versus informal ones.
Authored by Izabela Styczynska
Published in 2012
A comprehensive analysis of the gender wage differential among Finnish full time employees is reported. Oaxaca decompositions show that the the overall wage gap of about 21.5 per cent cannot be accounted for by individual characteristics, since age and educational qualifications are rather similar for men and women. When industry and occupational qualifications are included in the regressor matrix, the unexplained part shrinks to about 50 per cent of the gross differential. An even larger part of the gross differential can be explained in sector-specific analyses with a dense set of occupational dummies. In a less standard part of the analysis, we characterise the distribution of the unexplained wage gap across the variable space. It turns out the women with a high wage predictor, that is, women with good educational qualifications in well-remunerated occupations, drag the most behind their male colleagues endowed with similar characteristics.
There is little previous comparative research on how new EU member state immigrants (NMS12) and their labour market performance differ across the old member states. This paper extends the earlier literature by investigating NMS12 immigrants’ composition and labour market performance in Finland, Germany, the Netherlands, and the United Kingdom, which are characterized by considerable differences in their labour market institutions. These institutional structures might also influence the labour market outcomes of NMS12 immigrants and these countries’ abilities to absorb immigrants. As measures of labour market performance we use labour force participation, employment, type of employment, and occupational attainment. We use pooled cross-sectional data from the European Union Labour Force Survey from the years 2004-2009 in the analyses.
We find that NMS12 immigrants have, on average, a lower probability of employment than similar natives in all other countries except for the UK. As expected with the time spent in the host country, the employment gap between NMS12 immigrants and natives narrows in Finland, Germany and the Netherlands. NMS12 immigrants seem not only to suffer from lower employment (except in the UK), but the disadvantage NMS12 immigrants have in the labour market also shows itself in the type of employment and occupations they hold. NMS12 immigrants work more often as self-employed (except in Finland) and in temporary jobs which are often combined with poorer job quality than regular jobs. In addition, NMS12 immigrants’ likelihood of working in elementary occupations is higher in all four countries. Nonetheless, we also detect interesting differences among the countries in how much the NMS12 immigrants’ labour market position deviates from that of similar natives with regard to the type of employment and occupational attainment which can partly be explained by institutional differences among these countries.
In this paper we study the wage curve with both cross-sectional and pooled Finnish data. Hourly wage is used as a dependent variable throughout the paper as well as a fairly detailed definition of the local labour market. Results indicate that there exists a relationship similar to downward sloping wage curve in the Finnish data. Results are sensitive to the inclusion of regional fixed effects.
The document examines determinants of job search intensity in Denmark, Finland, and Norway using survey data from 1998. It finds:
1) Job search intensity varies significantly between the countries, with Danish and Finnish respondents less likely to search and Norwegians searching most intensely.
2) Attitudes towards work positively impact search, while those facing economic hardship from unemployment search harder.
3) In Finland and Norway, unemployment benefit recipients search more actively than non-recipients, while there is no difference in Denmark.
This study examines whether innovation-focused place-based policies in Russia, such as science cities, have impacted local development. The authors use unique municipal and firm-level datasets and matching techniques to compare science cities to similar non-science cities. The results show that science cities produce more patents than comparable municipalities, but firms in science cities do not appear more innovative or productive. The authors suggest this may be due to persistence of human capital and knowledge spillovers from scientists who remained in science cities after the Soviet Union's collapse.
This document analyzes survey data from 220 Polish manufacturing firms from 1998-2003 to identify factors of employment growth and firm performance. It finds that firms which viewed themselves as more competitive, innovated more, and were privatized earlier performed better in terms of employment levels. However, econometric analysis showed that only foreign ownership had a statistically significant positive impact on revenues, productivity, profits and wages. The study provides insights into how different factors like competitiveness, technology, ownership and privatization affected employment growth and firm performance in Polish manufacturing during transition.
This paper investigates an impact of the government policies aimed at the enterprise sector on competitiveness of this sector. The analysis was based on an example of the Polish manufacturing sector and the eight-year period from 1996 to 2003.
The general recommendation is that the competitiveness of the Polish manufacturing sector could be increased by relaxing fiscal burden, further privatization and restructuring of state owned companies. The state aid in a form of subsidies seems to harm both internal and external competitiveness rather than to support them.
Authored by: Ewa Balcerowicz, Maciej Sobolewski
Published in 2005
Differences in the growth of firms remain a major topic in economics and strategy research. In this paper we investigated the link between innovation performance and employment growth. First we discuss the problem from the theoretical point of view and then we analyze the relationship between innovation performance and the dynamics of employment in the Polish service firms in 2004-2009. Firms that introduced new services or marketing techniques experienced stronger growth. Process innovations contributed to employment reduction. Tellingly, this effect could only be observed in 2008-2009, a subperiod which saw the lowest levels of aggregate demand. This conclusion yields support to the presumption formulated by Pianta (2005) that the impact of innovation on employment growth depends on the macroeconomic situation.
Authored by: Wojciech Grabowski, Krzysztof Szczygielski, Richard Woodward
Published in 2013
This paper analyses the employment effects of mergers and acquisitions (M&As) by using matched establishment-level data from Finland over the period 1989–2003. The data covers all sectors. We compare the employment effects of cross-border M&As with the effects arising from two different types of domestic M&As and internal restructurings. The results reveal that cross-border M&As lead to downsizing in manufacturing employment. The effects of cross-border M&As on employment in nonmanufacturing are much weaker. Changes in ownership associated with domestic M&As and internal restructurings also typically cause employment losses, but they exhibit an interesting sectoral variation.
As the process of population ageing in Europe carries on and the retirement age increases, the relationship between age and productivity becomes more and more important. One can be afraid that as the average age of the working individual goes up, the average level of productivity growth will go down, resulting in decreasing competitiveness of European economies. Our expectation is that due to serious differences in labor market structures between New Member States (NMS) (including current candidates) and the EU15, the former are the first order candidates to experience higher than average productivity costs of ageing in the near future. In this paper, one tries to examine this hypothesis.
The research strategy in this study has been based on the assumption that, in general, wages are correlated with productivity on the individual level and, as such, can be used as a proxy for productivity. Such an assumption is quite risky and can be easily criticized. Hence, based on the results of earlier studies, our main empirical analysis is limited to groups of workers for which one can expect that correlation between productivity and wages is still substantial.
It seems, that taking all the caveats in mind, the results of our analysis show that the relative productivity of older workers in the NMS is lower than in EU15.
Authored by: Mateusz Walewski
Published in 2007
How has Income Inequality and Wage Disparity Between Native and Foreign Sub-p...Dinal Shah
This study uses repeated cross-sectional data from 2007 to 2015 to examine in
detail what impact the 2008 recession had on income inequality and wage disparity
in the UK and on its sub-populations. The findings suggest inequality in the UK has
been decreasing since 2007, but that the foreign sub-population experiences a
greater degree of inequality than the native sub-population. Additionally, foreign and
native labour are imperfect substitutes where the wages of foreign workers are
greatly more susceptible to economic shocks effecting the UK’s labour market. To
the best of my knowledge this is the first paper to conduct research into income
inequality between native and foreign workers.
Labour_Mobility, Housing_Prices and Unemployment - ForslundSandra Forslund
This document summarizes a master's thesis that examines the relationship between rising housing costs, labor mobility, and unemployment in Sweden. The thesis explores how increasing housing costs can act as a deterrent to relocation, leading to labor market rigidities that can exacerbate or prolong unemployment.
The thesis finds that most variables indicating a relationship between rising housing costs and unemployment are positively correlated, as expected based on previous research linking falling home prices to unemployment. However, one variable surprisingly showed a negative relationship. Overall, there is sufficient evidence from the theoretical framework and estimations to infer that rising housing costs hinder labor mobility and can increase unemployment.
The results generally support the hypothesis that higher housing costs make relocation or remaining in
This document discusses external and internal determinants of firm technology strategy based on a study of Polish service sector firms. It reviews literature on defining components of technology strategy and how the external environment may influence these components. The document also discusses different industry groupings based on a taxonomy and their expected innovation activities. The study aims to evaluate the relative importance of observable internal versus external factors in determining technology strategies in the service sector using Polish Community Innovation Survey data from 2004-2006 and 2008-2010.
It has become common to measure the quality of exports using their unit export value (UEV). Applications of this method include studies of intra-industry trade (IIT) and analyses of industrial 'competitiveness'. This literature seems to assume that export quality and export price (the most natural interpretation of UEV) are not merely correlated but that they follow each other one-for-one. We put this assumption under scrutiny from both a theoretical and empirical point of view. In terms of theory, we formalize this assumption as a hypothesis of the proportionality of equilibrium prices and equilibrium qualities. We discuss several cases for which this hypothesis is theoretically doubtful (non-linear utility- and cost functions; strong and asymmetric horizontal product differentiation). We also suggest two methods of verifying the hypothesis for cases in which it cannot be easily rejected theoretically. These two methods are then applied to German imports in the period of 1994-2006. We find that the implications of the proportionality hypothesis are largely.
Authored by: Wojciech Grabowski and Krzysztof Szczygielski
This document analyzes the relationship between social media usage and protest participation in Russia from 2011-2012. It uses variation in the early adoption of the social media platform VKontakte (VK) across Russian cities to identify a causal impact. Early VK users were predominantly students from Saint Petersburg State University (SPbSU) in the same cohort as the founder. Regression analyses show cities with more SPbSU students from this cohort had higher VK penetration and a greater likelihood of protests. Instrumental variable models estimate that higher VK usage significantly increased both the number of protesters and probability of protests. Placebo tests found no effects on pre-2006 outcomes, supporting a causal interpretation.
This paper examines the motives behind foreign direct investment (FDI) in a group of four CIS countries (Ukraine, Moldova, Georgia and Kyrgyzstan) based on a survey of 120 enterprises. The results indicate that non-oil multi-national enterprises (MNEs) are predominantly oriented at serving local markets. Most MNEs in the CIS operate as 'isolated players', maintaining strong links to their parent companies, while minimally cooperating with local CIS firms. The surveyed firms secure the majority of supplies from international sources. For this reason, the possibility for spillovers arising from cooperation with foreign-owned firms in the CIS is rather low at this time. The lack of efficiency-seeking investment poses further concern regarding the nature of FDI in the region. The most significant problems identified in the daily operations of the surveyed foreign firms are: the volatility of the political and economic environment, the ambiguity of the legal system and the high levels of corruption.
Authored by: Malgorzata Jakubiak
Published in 2008
Using Finnish data this paper examines to what extent the share of all nurses in unemployment, health care employment and being out of the labour market after the exam of a cohort have affected the long-run outcomes of the cohort. The shares are calculated for all cohorts and years and standardised in each year by dividing the cohort specific rate with the average rate for all nurses. These standardised variables are used as dependent variables. The long-term effects are significant at least for the unemployment and the depression have according to the estimates raised the long-run unemployment by more than 2 percentage points for the nurses graduating then. For the employment in the health care industry the effects may be even larger but the estimates are more uncertain.
Tutkimuksessa tarkastellaan työmarkkinoiden polarisoitumista Suomessa. Aiemmat tutkimukset tarkastelevat kehitystä koko talouden, toimialojen tai alueiden tasolla. Tutkimuksessa tarkastellaan työpaikkojen rakennemuutosta yritystasolla. Tulokset osoittavat, että rutiiniluonteiset työtehtävät ovat vähentyneet merkittävästi suomalaisissa yrityksissä. Palkkajakauman keskivaiheilla olevien rutiiniluonteisten työtehtävien väheneminen kytkeytyy informaatio- ja kommunikaatioteknologian käyttöönottoon yrityksissä.
Do Women Earn Less Even as Social EntrepreneursSEFORÏS
Based upon unique survey data collected using respondent driven sampling methods, we
investigate whether there is a gender pay gap among social entrepreneurs in the UK. We find
that women as social entrepreneurs earn 29% less than their male colleagues, above the
average UK gender pay gap of 19%. We estimate the adjusted pay gap to be about 23%
after controlling for a range of demographic, human capital and job characteristics, as well as
personal preferences and values. These differences are hard to explain by discrimination
since these CEOs set their own pay. Income may not be the only aim in an entrepreneurial
career, so we also look at job satisfaction to proxy for non-monetary returns. We find female
social entrepreneurs to be more satisfied with their job as a CEO of a social enterprise than
their male counterparts. This result holds even when we control for the salary generated
through the social enterprise. Our results extend research in labour economics on the gender
pay gap as well as entrepreneurship research on women’s entrepreneurship to the novel
context of social enterprise. It provides the first evidence for a “contented female social
entrepreneur” paradox.
Gender Pay Equality Annotated Bibliography
Arulampalam, W., Booth, A. L., & Bryan, M. L. (2007). Is there a glass ceiling over Europe? Exploring the gender pay gap across the wage distribution. ILR Review, 60(2), 163-186.
In their study, Arulampalam, Booth, and Bryan (2007) set out to examine the level of differences in gender pay gaps between those in top-level employment positions and those in lower positions. The research confirms the findings by Polacheck (2004) on his assertion that as interests between the men and women employees decrease, the pay gap between them decreases. Top-level employees are highly likely to have made a decision on career improvement and success in the said profession, making them more zealous in pursuit of success than junior employees. To have similar interests irrespective of gender. The study fits well into the discussion as it explains the role of the human capital model in explaining the difference.
However, this research uses too much specialized business language, which limits its audience to those privy of business language. Although it tackles a business field issue, part of the audience could comprise of new entrants into the market with limited knowledge of concepts, such as the glass ceiling. The use of such would be a disincentive to the reader, limiting the availability of knowledge. However, other than the jargon, the researchers use different business management theories to make their case, which serves as a positive aspect of the study.
Blau, F. D., & Kahn, L. M. (2000). Gender differences in pay (No. w7732). National bureau of economic research.
The objective of Blau and Khan’s study was to establish some of the factors attributable to the gender pay gap in the United States. According to the researchers, several factors including discrimination and overall wage structure have a significant influence on the gender pay gap in the society. Notably, the researcher alludes to the presence of discrimination in the workplace as a cause of gender pay gap, which adds to the previously identified human capital model as a factor contributing to gender pay gap issues. However, the study’s findings conclude that the United States has a higher gap than other countries largely due to the high wage inequality in the country. This raises the question of government policies in influencing the gaps as highlighted by Smith and Villa (2010) in their analysis of European Union policies influencing employment. The research findings also raise the issue of the development of a country and its relation to the level of gender pay gaps, a sentiment echoed by Mandel and Semyonov (2006). Having so much support from other sources within the research is a primary strength for this study, and makes it especially indispensable in this research. However, too much focus on the United States presents a challenge of committing generalization fallacies in extrapolating the findings and this research to the larger society.
Brand ...
A comprehensive analysis of the gender wage differential among Finnish full time employees is reported. Oaxaca decompositions show that the the overall wage gap of about 21.5 per cent cannot be accounted for by individual characteristics, since age and educational qualifications are rather similar for men and women. When industry and occupational qualifications are included in the regressor matrix, the unexplained part shrinks to about 50 per cent of the gross differential. An even larger part of the gross differential can be explained in sector-specific analyses with a dense set of occupational dummies. In a less standard part of the analysis, we characterise the distribution of the unexplained wage gap across the variable space. It turns out the women with a high wage predictor, that is, women with good educational qualifications in well-remunerated occupations, drag the most behind their male colleagues endowed with similar characteristics.
There is little previous comparative research on how new EU member state immigrants (NMS12) and their labour market performance differ across the old member states. This paper extends the earlier literature by investigating NMS12 immigrants’ composition and labour market performance in Finland, Germany, the Netherlands, and the United Kingdom, which are characterized by considerable differences in their labour market institutions. These institutional structures might also influence the labour market outcomes of NMS12 immigrants and these countries’ abilities to absorb immigrants. As measures of labour market performance we use labour force participation, employment, type of employment, and occupational attainment. We use pooled cross-sectional data from the European Union Labour Force Survey from the years 2004-2009 in the analyses.
We find that NMS12 immigrants have, on average, a lower probability of employment than similar natives in all other countries except for the UK. As expected with the time spent in the host country, the employment gap between NMS12 immigrants and natives narrows in Finland, Germany and the Netherlands. NMS12 immigrants seem not only to suffer from lower employment (except in the UK), but the disadvantage NMS12 immigrants have in the labour market also shows itself in the type of employment and occupations they hold. NMS12 immigrants work more often as self-employed (except in Finland) and in temporary jobs which are often combined with poorer job quality than regular jobs. In addition, NMS12 immigrants’ likelihood of working in elementary occupations is higher in all four countries. Nonetheless, we also detect interesting differences among the countries in how much the NMS12 immigrants’ labour market position deviates from that of similar natives with regard to the type of employment and occupational attainment which can partly be explained by institutional differences among these countries.
In this paper we study the wage curve with both cross-sectional and pooled Finnish data. Hourly wage is used as a dependent variable throughout the paper as well as a fairly detailed definition of the local labour market. Results indicate that there exists a relationship similar to downward sloping wage curve in the Finnish data. Results are sensitive to the inclusion of regional fixed effects.
The document examines determinants of job search intensity in Denmark, Finland, and Norway using survey data from 1998. It finds:
1) Job search intensity varies significantly between the countries, with Danish and Finnish respondents less likely to search and Norwegians searching most intensely.
2) Attitudes towards work positively impact search, while those facing economic hardship from unemployment search harder.
3) In Finland and Norway, unemployment benefit recipients search more actively than non-recipients, while there is no difference in Denmark.
This study examines whether innovation-focused place-based policies in Russia, such as science cities, have impacted local development. The authors use unique municipal and firm-level datasets and matching techniques to compare science cities to similar non-science cities. The results show that science cities produce more patents than comparable municipalities, but firms in science cities do not appear more innovative or productive. The authors suggest this may be due to persistence of human capital and knowledge spillovers from scientists who remained in science cities after the Soviet Union's collapse.
This document analyzes survey data from 220 Polish manufacturing firms from 1998-2003 to identify factors of employment growth and firm performance. It finds that firms which viewed themselves as more competitive, innovated more, and were privatized earlier performed better in terms of employment levels. However, econometric analysis showed that only foreign ownership had a statistically significant positive impact on revenues, productivity, profits and wages. The study provides insights into how different factors like competitiveness, technology, ownership and privatization affected employment growth and firm performance in Polish manufacturing during transition.
This paper investigates an impact of the government policies aimed at the enterprise sector on competitiveness of this sector. The analysis was based on an example of the Polish manufacturing sector and the eight-year period from 1996 to 2003.
The general recommendation is that the competitiveness of the Polish manufacturing sector could be increased by relaxing fiscal burden, further privatization and restructuring of state owned companies. The state aid in a form of subsidies seems to harm both internal and external competitiveness rather than to support them.
Authored by: Ewa Balcerowicz, Maciej Sobolewski
Published in 2005
Differences in the growth of firms remain a major topic in economics and strategy research. In this paper we investigated the link between innovation performance and employment growth. First we discuss the problem from the theoretical point of view and then we analyze the relationship between innovation performance and the dynamics of employment in the Polish service firms in 2004-2009. Firms that introduced new services or marketing techniques experienced stronger growth. Process innovations contributed to employment reduction. Tellingly, this effect could only be observed in 2008-2009, a subperiod which saw the lowest levels of aggregate demand. This conclusion yields support to the presumption formulated by Pianta (2005) that the impact of innovation on employment growth depends on the macroeconomic situation.
Authored by: Wojciech Grabowski, Krzysztof Szczygielski, Richard Woodward
Published in 2013
This paper analyses the employment effects of mergers and acquisitions (M&As) by using matched establishment-level data from Finland over the period 1989–2003. The data covers all sectors. We compare the employment effects of cross-border M&As with the effects arising from two different types of domestic M&As and internal restructurings. The results reveal that cross-border M&As lead to downsizing in manufacturing employment. The effects of cross-border M&As on employment in nonmanufacturing are much weaker. Changes in ownership associated with domestic M&As and internal restructurings also typically cause employment losses, but they exhibit an interesting sectoral variation.
As the process of population ageing in Europe carries on and the retirement age increases, the relationship between age and productivity becomes more and more important. One can be afraid that as the average age of the working individual goes up, the average level of productivity growth will go down, resulting in decreasing competitiveness of European economies. Our expectation is that due to serious differences in labor market structures between New Member States (NMS) (including current candidates) and the EU15, the former are the first order candidates to experience higher than average productivity costs of ageing in the near future. In this paper, one tries to examine this hypothesis.
The research strategy in this study has been based on the assumption that, in general, wages are correlated with productivity on the individual level and, as such, can be used as a proxy for productivity. Such an assumption is quite risky and can be easily criticized. Hence, based on the results of earlier studies, our main empirical analysis is limited to groups of workers for which one can expect that correlation between productivity and wages is still substantial.
It seems, that taking all the caveats in mind, the results of our analysis show that the relative productivity of older workers in the NMS is lower than in EU15.
Authored by: Mateusz Walewski
Published in 2007
How has Income Inequality and Wage Disparity Between Native and Foreign Sub-p...Dinal Shah
This study uses repeated cross-sectional data from 2007 to 2015 to examine in
detail what impact the 2008 recession had on income inequality and wage disparity
in the UK and on its sub-populations. The findings suggest inequality in the UK has
been decreasing since 2007, but that the foreign sub-population experiences a
greater degree of inequality than the native sub-population. Additionally, foreign and
native labour are imperfect substitutes where the wages of foreign workers are
greatly more susceptible to economic shocks effecting the UK’s labour market. To
the best of my knowledge this is the first paper to conduct research into income
inequality between native and foreign workers.
Labour_Mobility, Housing_Prices and Unemployment - ForslundSandra Forslund
This document summarizes a master's thesis that examines the relationship between rising housing costs, labor mobility, and unemployment in Sweden. The thesis explores how increasing housing costs can act as a deterrent to relocation, leading to labor market rigidities that can exacerbate or prolong unemployment.
The thesis finds that most variables indicating a relationship between rising housing costs and unemployment are positively correlated, as expected based on previous research linking falling home prices to unemployment. However, one variable surprisingly showed a negative relationship. Overall, there is sufficient evidence from the theoretical framework and estimations to infer that rising housing costs hinder labor mobility and can increase unemployment.
The results generally support the hypothesis that higher housing costs make relocation or remaining in
This document discusses external and internal determinants of firm technology strategy based on a study of Polish service sector firms. It reviews literature on defining components of technology strategy and how the external environment may influence these components. The document also discusses different industry groupings based on a taxonomy and their expected innovation activities. The study aims to evaluate the relative importance of observable internal versus external factors in determining technology strategies in the service sector using Polish Community Innovation Survey data from 2004-2006 and 2008-2010.
It has become common to measure the quality of exports using their unit export value (UEV). Applications of this method include studies of intra-industry trade (IIT) and analyses of industrial 'competitiveness'. This literature seems to assume that export quality and export price (the most natural interpretation of UEV) are not merely correlated but that they follow each other one-for-one. We put this assumption under scrutiny from both a theoretical and empirical point of view. In terms of theory, we formalize this assumption as a hypothesis of the proportionality of equilibrium prices and equilibrium qualities. We discuss several cases for which this hypothesis is theoretically doubtful (non-linear utility- and cost functions; strong and asymmetric horizontal product differentiation). We also suggest two methods of verifying the hypothesis for cases in which it cannot be easily rejected theoretically. These two methods are then applied to German imports in the period of 1994-2006. We find that the implications of the proportionality hypothesis are largely.
Authored by: Wojciech Grabowski and Krzysztof Szczygielski
This document analyzes the relationship between social media usage and protest participation in Russia from 2011-2012. It uses variation in the early adoption of the social media platform VKontakte (VK) across Russian cities to identify a causal impact. Early VK users were predominantly students from Saint Petersburg State University (SPbSU) in the same cohort as the founder. Regression analyses show cities with more SPbSU students from this cohort had higher VK penetration and a greater likelihood of protests. Instrumental variable models estimate that higher VK usage significantly increased both the number of protesters and probability of protests. Placebo tests found no effects on pre-2006 outcomes, supporting a causal interpretation.
This paper examines the motives behind foreign direct investment (FDI) in a group of four CIS countries (Ukraine, Moldova, Georgia and Kyrgyzstan) based on a survey of 120 enterprises. The results indicate that non-oil multi-national enterprises (MNEs) are predominantly oriented at serving local markets. Most MNEs in the CIS operate as 'isolated players', maintaining strong links to their parent companies, while minimally cooperating with local CIS firms. The surveyed firms secure the majority of supplies from international sources. For this reason, the possibility for spillovers arising from cooperation with foreign-owned firms in the CIS is rather low at this time. The lack of efficiency-seeking investment poses further concern regarding the nature of FDI in the region. The most significant problems identified in the daily operations of the surveyed foreign firms are: the volatility of the political and economic environment, the ambiguity of the legal system and the high levels of corruption.
Authored by: Malgorzata Jakubiak
Published in 2008
Using Finnish data this paper examines to what extent the share of all nurses in unemployment, health care employment and being out of the labour market after the exam of a cohort have affected the long-run outcomes of the cohort. The shares are calculated for all cohorts and years and standardised in each year by dividing the cohort specific rate with the average rate for all nurses. These standardised variables are used as dependent variables. The long-term effects are significant at least for the unemployment and the depression have according to the estimates raised the long-run unemployment by more than 2 percentage points for the nurses graduating then. For the employment in the health care industry the effects may be even larger but the estimates are more uncertain.
Tutkimuksessa tarkastellaan työmarkkinoiden polarisoitumista Suomessa. Aiemmat tutkimukset tarkastelevat kehitystä koko talouden, toimialojen tai alueiden tasolla. Tutkimuksessa tarkastellaan työpaikkojen rakennemuutosta yritystasolla. Tulokset osoittavat, että rutiiniluonteiset työtehtävät ovat vähentyneet merkittävästi suomalaisissa yrityksissä. Palkkajakauman keskivaiheilla olevien rutiiniluonteisten työtehtävien väheneminen kytkeytyy informaatio- ja kommunikaatioteknologian käyttöönottoon yrityksissä.
Do Women Earn Less Even as Social EntrepreneursSEFORÏS
Based upon unique survey data collected using respondent driven sampling methods, we
investigate whether there is a gender pay gap among social entrepreneurs in the UK. We find
that women as social entrepreneurs earn 29% less than their male colleagues, above the
average UK gender pay gap of 19%. We estimate the adjusted pay gap to be about 23%
after controlling for a range of demographic, human capital and job characteristics, as well as
personal preferences and values. These differences are hard to explain by discrimination
since these CEOs set their own pay. Income may not be the only aim in an entrepreneurial
career, so we also look at job satisfaction to proxy for non-monetary returns. We find female
social entrepreneurs to be more satisfied with their job as a CEO of a social enterprise than
their male counterparts. This result holds even when we control for the salary generated
through the social enterprise. Our results extend research in labour economics on the gender
pay gap as well as entrepreneurship research on women’s entrepreneurship to the novel
context of social enterprise. It provides the first evidence for a “contented female social
entrepreneur” paradox.
Gender Pay Equality Annotated Bibliography
Arulampalam, W., Booth, A. L., & Bryan, M. L. (2007). Is there a glass ceiling over Europe? Exploring the gender pay gap across the wage distribution. ILR Review, 60(2), 163-186.
In their study, Arulampalam, Booth, and Bryan (2007) set out to examine the level of differences in gender pay gaps between those in top-level employment positions and those in lower positions. The research confirms the findings by Polacheck (2004) on his assertion that as interests between the men and women employees decrease, the pay gap between them decreases. Top-level employees are highly likely to have made a decision on career improvement and success in the said profession, making them more zealous in pursuit of success than junior employees. To have similar interests irrespective of gender. The study fits well into the discussion as it explains the role of the human capital model in explaining the difference.
However, this research uses too much specialized business language, which limits its audience to those privy of business language. Although it tackles a business field issue, part of the audience could comprise of new entrants into the market with limited knowledge of concepts, such as the glass ceiling. The use of such would be a disincentive to the reader, limiting the availability of knowledge. However, other than the jargon, the researchers use different business management theories to make their case, which serves as a positive aspect of the study.
Blau, F. D., & Kahn, L. M. (2000). Gender differences in pay (No. w7732). National bureau of economic research.
The objective of Blau and Khan’s study was to establish some of the factors attributable to the gender pay gap in the United States. According to the researchers, several factors including discrimination and overall wage structure have a significant influence on the gender pay gap in the society. Notably, the researcher alludes to the presence of discrimination in the workplace as a cause of gender pay gap, which adds to the previously identified human capital model as a factor contributing to gender pay gap issues. However, the study’s findings conclude that the United States has a higher gap than other countries largely due to the high wage inequality in the country. This raises the question of government policies in influencing the gaps as highlighted by Smith and Villa (2010) in their analysis of European Union policies influencing employment. The research findings also raise the issue of the development of a country and its relation to the level of gender pay gaps, a sentiment echoed by Mandel and Semyonov (2006). Having so much support from other sources within the research is a primary strength for this study, and makes it especially indispensable in this research. However, too much focus on the United States presents a challenge of committing generalization fallacies in extrapolating the findings and this research to the larger society.
Brand ...
Two in ten working age adults have been out of work for over a year in Visegrad economies and long term joblessness is especially high among the uneducated. The employment disadvantage of uneducated workers tends to be larger than in Western European countries, and is especially grievous in Hungary, where a relatively large share of the labour force has only completed primary school. The build-up of long term joblessnes may take its toll both on the individual and the economy. Beside the loss of human capital and potentially harmful effects on health and mental health, the lower job search intensity of the long term unemployed may lead to weaker wage adjustment and slower economic recovery. Long term non-employment also increases poverty and social exclusion, which may further constrain economic growth. Reducing long term unemployment by activating the unemployed, increasing the education level or preventing early retirement could potentially increase the total employment rateby 2-3 % points in the Visegrad countries.
The publication was authored by Ágota Scharle, with contributions from Márton Csillag, Lucia Mýtna Kureková, Monika Maksim, Anna Orosz, Filip Pertold, Izabela Styczyńska, and Balázs Váradi. It was prepared during the Policy workshops for V4 think tanks, sponsored by the Visegrad Fund.
Authored by: Izabela Styczynska
Published in 2014
The study explores the empirical determination of perceived job instability in European labour markets. The study is based on the large-scale survey from the year 1998 covering the 15 member states of the European Union and Norway. There are evidently large differences in the amount of perceived job instability from country to country. The lowest level of perceived job instabity is in Denmark (9%). In contrast, the highest level of perceived job instability is in Spain (63%). The results show that perceived job instability increases with age. Educational level, on the other hand, does not correlate strongly with the perception of job instability. There are no differences in the perceptions of job instability between males and females. An occurrence of unemployment during the past five years yields a substantial rise in the perception of job instability. The empirical finding that unemployment history strongly matters for the perception of job instability is consistent with the notion that an unemployment episode provides otherwise private information about unobservable productivity of an employee. The most striking result is that a temporary contract as such does not yield an additional increase to the perception of job instability at the individual level of the economy. However, the perception of job instability is more common within manufacturing industries. In addition, the perception of job instability by employees increases according to the size of the firm. There are also strong country effects.
This document provides a literature review on explanations for the gender pay gap. It discusses both mainstream economic theories like human capital theory and feminist perspectives. Human capital theory posits that women receive lower returns on their education and skills due to discrimination. Feminist views argue structural and cultural factors like occupational segregation and gender stereotypes reinforce the pay gap. The document evaluates factors like increased female participation in the workforce reducing the gap but discrimination persists as women still earn 15% less despite higher education levels.
This paper focuses on emerging labour patterns within the Socio-Ecological Transition (SET), with particular attention paid to the effects of urbanisation. Based on the European Labour Force Survey (ELFS), the authors mobilize micro-econometric approaches in order to understand three major employment patterns: job mobility (between unemployment, inactivity, and employment), the desire to change jobs, and underemployment (i.e. part time jobs) in the European Union.
The results show that the urbanization transition might express some positive effects on the labour market in the medium-term for several reasons. The employment rate has slightly decreased in all types of regions, yet it remains higher in urban settlements. Urban settlements offer more job opportunities and more part-time employment options. However, cyclical shocks tend to have a higher impact on urban areas when compared to rural areas. This means higher chances for employment in urban settlements during a boom and more job losses during a slow-down (causing less security on the labour market).
Authored by: Izabela Styczynska, Boris Najman, Alexander Neumann
Published in 2013
Gender Pay Gap and Employment Sector Sourcesof Earnings Dis.docxhanneloremccaffery
Gender Pay Gap and Employment Sector: Sources
of Earnings Disparities in the United States, 1970–2010
Hadas Mandel & Moshe Semyonov
Published online: 23 August 2014
# Population Association of America 2014
Abstract Using data from the IPUMS-USA, the present research focuses on trends in
the gender earnings gap in the United States between 1970 and 2010. The major goal of
this article is to understand the sources of the convergence in men’s and women’s
earnings in the public and private sectors as well as the stagnation of this trend in the
new millennium. For this purpose, we delineate temporal changes in the role played by
major sources of the gap. Several components are identified: the portion of the gap
attributed to gender differences in human-capital resources; labor supply;
sociodemographic attributes; occupational segregation; and the unexplained portion
of the gap. The findings reveal a substantial reduction in the gross gender earnings gap
in both sectors of the economy. Most of the decline is attributed to the reduction in the
unexplained portion of the gap, implying a significant decline in economic discrimi-
nation against women. In contrast to discrimination, the role played by human capital
and personal attributes in explaining the gender pay gap is relatively small in both
sectors. Differences between the two sectors are not only in the size and pace of the
reduction but also in the significance of the two major sources of the gap. Working
hours have become the most important factor with respect to gender pay inequality in
both sectors, although much more dominantly in the private sector. The declining
gender segregation may explain the decreased impact of occupations on the gender
pay gap in the private sector. In the public sector, by contrast, gender segregation still
accounts for a substantial portion of the gap. The findings are discussed in light of the
theoretical literature on sources of gender economic inequality and in light of the recent
stagnation of the trend.
Keywords Gender pay gaps . Public sector. Private sector. Gender discrimination
Demography (2014) 51:1597–1618
DOI 10.1007/s13524-014-0320-y
Electronic supplementary material The online version of this article (doi:10.1007/s13524-014-0320-y)
contains supplementary material, which is available to authorized users.
H. Mandel (*): M. Semyonov
Department of Sociology and Anthropology, Tel-Aviv University, Tel-Aviv, Israel 69978
e-mail: [email protected]
http://dx.doi.org/10.1007/s13524-014-0320-y
Thesis statement
The purpose of this paper is to share research and inform scholars.
Introduction
One of the most significant social changes in recent decades has been the changing
economic status of women. Since the middle of the twentieth century, women have not
only joined the economically active labor force in ever-increasing numbers but also
enhanced their education and improved their occupational status and economic re-
wards. More specifically, during ...
This document summarizes a study examining the relationship between labor share and unemployment in major OECD countries from 1972 to 2008. It analyzes whether the relationship has changed in a way that could indicate weakened bargaining power for labor. The study uses panel data and statistical methods for non-stationary panels to estimate wage curves and dynamic equations modeling how labor share adjusts to unemployment. Preliminary results suggest labor share declines in most OECD countries cannot be fully explained by rising unemployment and likely reflect weakened bargaining power for labor unions. The nature of the relationship may also differ between countries with varying wage-setting institutions and bargaining coordination.
This chapter discusses five key reasons for the gender pay gap found in research:
1) Women's skills are often undervalued, leading to lower pay in female-dominated occupations like teaching.
2) Women face lower investment in their training and development due to career breaks for childcare.
3) Women often work part-time or face discrimination when changing jobs, resulting in lower hourly pay.
4) A lack of pay transparency can allow employers to underpay women who are unaware of fair market rates.
5) Union negotiators may not strategize enough on women's pay, and collective bargaining can undervalue skills.
The chapter urges HR practitioners to address undervaluation of skills, support women
Gender wage gap in Poland: Can it be explained by differences in observable c...GRAPE
We describe the evolution of the gender wage gap in Poland since transition. The results suggest that it was rather stable over time and that it cannot be explained by characteristics. If anything, women should be earning more than men!!!
Using propensity score matching combined with the differences-in-differences method this paper investigates gender differences in the wage effects of job mobility among young white-collar workers in the Finnish manufacturing sector over the period 1997–2006. A novel feature of our paper is that besides distinguishing between intrafirm and interfirm job changes we also investigate mobility and wage growth by educational level. These refinements prove to be important. Our results indicate that both kinds of mobility boost wage growth, but the positive effects are much higher for interfirm mobility. Also the gender gap in the returns to job changes varies with the type of mobility, the gap being 1.2 percentage points with interfirm mobility and non-existent when job changes within firms are considered. Furthermore, we find that there are differences in the returns to mobility between educational levels. The low-educated women benefit less from mobility than the high-educated women, especially with employer changes. For men, on the other hand, no such variation in the wage effects of mobility across educational levels is observed.
Demographic change (driven by the second demographic transition) led to an uncontrolled increase in scale of various social expenditure in the OECD area, especially in continental Europe. Costs of social transfers created fiscal pressure leading to the necessity of tax increases all over Europe, including the New Member States. Employment consequences of emerging higher tax wedge has become the topic of large body of research. However, surprisingly little evidence is known on distribution of that problem across workers. Is the effect of high tax wedge equally spread or certain groups of workers suffer more than others? More specifically, are low productivity workers exposed more to the problems caused by high tax wedge?
Authored by: Marek Gora, Artur Radziwill, Agnieszka Sowa, Mateusz Walewski
Published in 2006
This study examines the impact of migration experience on occupational attainment and perceptions of overqualification. The study uses survey data from Estonian return migrants who lived in Finland and a comparison group of Estonians who never lived abroad. The results show that educational qualifications obtained in Finland are associated with higher occupational attainment in Estonia. However, migration experience alone does not impact occupational attainment. Experiencing occupational downgrading in Finland also does not affect later attainment in Estonia. Return migrants are less likely than potential migrants to view their job as below their competence level, suggesting selection effects. Financial success or difficulties abroad can impact feelings of overqualification. Overall migration experience does not consistently impact occupational or subjective outcomes.
Anthony Orji_2023 AGRODEP Annual ConferenceAKADEMIYA2063
This document describes a study investigating gender wage gaps in the Nigerian labor market. It aims to analyze gaps along the entire wage distribution and explain factors contributing to differences over time. Previous Nigerian studies mostly examined average gaps. This study will decompose gaps into portions due to differences in individual characteristics ("composition effects") and returns to those characteristics ("price effects"). It will use data from 2003/2004 and 2018/2019 surveys to analyze temporal changes. The study aims to provide insights on glass ceiling/sticky floor effects and design of gender-sensitive policies in Nigeria.
This document discusses analyzing the gender income gap in Canada using data from the 2011 National Household Survey. It hypothesizes that the gap may be explained by differences in human capital, occupational segregation, and sociological factors. Tables from the survey data show women are underrepresented in high-paying management jobs and have lower incomes than men even with the same education and work in the same industries. The document proposes using an Oaxaca decomposition model to identify how much of the income gap can be explained by differences in individual characteristics versus unexplained discrimination.
This document analyzes factors that contribute to the gender pay gap. It discusses how previous research has focused on gender-specific factors like differences in qualifications and labor market discrimination against equally qualified men and women. It argues that an additional important factor is wage structure, which describes how much different skills and sectors are paid. The document presents evidence that wage structure significantly impacts international and time trends in gender pay differentials. While qualifications and discrimination play a role, wage structure is important to also consider in understanding the gender pay gap.
Do Men and Women-Economists Choose the Same Research Fields?cecciar
This document analyzes gender differences in the choice of research fields among economists. It finds that while the percentage of women earning PhDs in economics has increased, "old gender gaps" persist, with women being unevenly distributed across fields of research. The paper uses a new dataset of researchers from top 50 economics departments to test theories about why these disparities exist. It finds evidence that the likelihood a woman works in a given field is positively related to the share of women already in that field ("path dependence"). Additionally, fields with more women on average tend to have lower quality researchers. However, these patterns are weaker for younger female researchers. The document also shows how gender segregation has evolved over time.
This document is a research report that analyzes the links between age, productivity, and lifelong learning in Europe. It uses various data sources and methodological approaches. The report finds that age-earnings profiles differ across European countries and can be grouped into clusters based on employment rates of older workers and average career lengths. Individual career paths are influenced by cohort effects and timing of labor market entry/exit. Earnings dynamics after age 50 are less dependent on education and occupation than at earlier ages. Estimation results suggest participation in training after age 50 can increase wages in the short-term, indicating lifelong learning may help maintain productivity at older ages.
исследование как торговля влияет на половое неравенствоGeneSysAM
This document summarizes a working paper that examines how trade liberalization impacts gender inequality through technological changes. The paper builds a model where firms adopt new technologies that require less physically demanding "blue-collar" skills, making women relatively more productive in these jobs. The paper tests this model using Mexican establishment data around NAFTA tariff reductions. The results show that tariff cuts led new firms to enter exporting and adopt technologies replacing male blue-collar workers with female blue-collar workers, improving women's outcomes in these jobs. However, women's shares in white-collar jobs were largely unaffected, since physical skill demands did not change as much in those occupations.
Unemployment and Its Determinants:A Study of Pakistan Economy (1999-2010)Muhammad Arslan
This study analyzed the determinants of unemployment in Pakistan from 1999-2010. It found that foreign direct investment, GDP growth, and inflation had negative relationships with unemployment, while population growth had a positive relationship. The model showed that 86% of changes in unemployment could be explained by these variables. It concluded that population growth is a key determinant of unemployment in Pakistan and recommended policies to attract FDI, control inflation, and reduce population growth to lower unemployment.
Similar to CASE Network Studies and Analyses 406 - The Gender Pay Gap in Informal Employment in Poland (20)
The report examines the social and economic drivers and impact of circular migration between Belarus and Poland, Slovakia, and the Czech Republic. The core question the authors sought to address was how managing circular migration could, in the long term, help to optimise labour resources in both the country of origin and the destination countries. In the pages that follow, the authors of the report present the current and forecasted labour market and demographic situation in their respective countries as well as the dynamics and characteristics of short-term labour migration flows between Belarus and Poland, Slovakia, and the Czech Republic, concentrating on the period since 2010. They also outline and discuss related policy responses and evaluate prospects for cooperation on circular migration.
Podręcznik został opracowany w celu przekazania trenerom i nauczycielom podstawowej wiedzy, która może być przydatna w prowadzeniu szkoleń promujących pracę rejestrowaną. Prezentuje on z jednej strony korzyści z pracy rejestrowanej, z drugiej – potencjalne koszty związane z pracą nierejestrowaną. W pierwszej kolejności informacje te przedstawiono w odniesieniu do pracowników najemnych (rozdział 2), podkreślając w sposób szczególny to, że negatywne konsekwencje pracy nierejestrowanej są ponoszone przez całe życie. Ze względu na specyficzną sytuację cudzoziemców pracujących w Polsce konsekwencje ponoszone przez tę grupę opisano oddzielnie (rozdział 3). Ponadto zaprezentowano skutki dotyczące pracodawców z szarej strefy z wyodrębnieniem tych, którzy zatrudniają cudzoziemców (rozdział 4). Uzupełnieniem przedstawionych informacji jest opis działań podejmowanych przez państwo w celu ograniczenia zjawiska pracy nierejestrowanej w Polsce (rozdział 5) oraz prowadzonych w Wielkiej Brytanii, czyli w kraju będącym liderem w walce z szarą strefą (rozdział 6).
European countries face a challenge related to the economic and social consequences of their societies’ aging. Specifically, pension systems must adjust to the coming changes, maintaining both financial stability, connected with equalizing inflows from premiums and spending on pensions, and simultaneously the sufficiency of benefits, protecting retirees against poverty and smoothing consumption over their lives, i.e. ensuring the ability to pay for consumption needs at each stage of life, regardless of income from labor.
One of the key instruments applied toward these goals is the retirement age. Formally it is a legally established boundary: once people have crossed it – on average – they significantly lose their ability to perform work (the so-called old-age risk). But since the 1970s, in many developed countries the retirement age has become an instrument of social and labor-market policy. Specifically, in the 1970s and ‘80s, an early retirement age was perceived as a solution allowing a reduction in the supply of labor, particularly among people with relatively low competencies who were approaching retirement age, which is called the lump of labor fallacy. It was often believed that people taking early retirement freed up jobs for the young. But a range of economic evidence shows that the number of jobs is not fixed, and those who retire don’t in fact free up jobs. On the contrary, because of higher spending by pension systems, labor costs rise, which limits the supply of jobs. In general, a good situation on the labor market supports employment of both the youngest and the oldest labor force participants. Additionally, a lower retirement age for women was maintained, which resulted to a high degree from cultural conditions and norms that are typical for traditional societies.
Until now, the banking sector has been one of the strong points of Poland’s economy. In contrast to banks in the U.S. and leading Western European economies, lenders in Poland came through the 2008 global financial crisis without a scratch, without needing state financial support. But in recent years the industry’s problems have been growing, creating a threat to economic growth and gains in living standards.
For an economy’s productivity to increase, funds can’t go to all companies evenly, and definitely shouldn’t go to those that are most lacking in funds, but to those that will use them most efficiently. This is true of total external financing, and thus funding both from the banking sector and from parabanks, the capital market and funds from public institutions. In Poland, in light of the relatively modest scale of the capital market, banks play a clearly dominant role in external financing of companies. This is why the author of this text focuses on the bank credit allocation efficiency.
The author points out that in the very near future, conditions will emerge in Poland which – as the experience of other countries shows – create a risk of reduced efficiency of credit allocation to business. Additionally, in Poland today, bank lending to companies is to a high degree being replaced by funds from state aid, which reduces the efficiency of allocation of external funds to companies (both loans and subsidies), as allocation of government subsidies is not usually based on efficiency. This decline in external financing allocation efficiency may slow, halt or even reverse the process, that has been uninterrupted for 28 years, of Poland’s convergence, i.e. the narrowing of the gap in living standards between Poland and the West.
The economic characteristics of the COVID-19 crisis differ from those of previous crises. It is a combination of demand- and supply-side constraints which led to the formation of a monetary overhang that will be unfrozen once the pandemic ends. Monetary policy must take this effect into consideration, along with other pro-inflationary factors, in the post-pandemic era. It must also think in advance about how to avoid a policy trap coming from fiscal dominance.
This paper is organized as follows: Chapter 2 deals with the economic characteristics of the COVID-19 pandemic and its impact on the effectiveness of the monetary policy response measures undertaken. In Chapter 3, we analyse the monetary policy decisions of the ECB (and other major CBs for comparison) and their effectiveness in achieving the declared policy goals in the short term. Chapter 4 is devoted to an analysis of the policy challenges which may be faced by the ECB and other major CBs once the pandemic emergency comes to its end. Chapter 5 contains a summary and the conclusions of our analysis.
Purpose: This paper tries to identify the wage gap between informal and formal workers and tests for the two-tier structure of the informal labour market in Poland.
Design/methodology/approach: I employ the propensity score matching (PSM) technique and use data from the Polish Labour Force Survey (LFS) for the period 2009–2017 to estimate the wage gap between informal and formal workers, both at the means and along the wage distribution. I use two definitions of informal employment: a) employment without a written agreement and b) employment while officially registered as unemployed at a labour office. In order to reduce the bias resulting from the non-random selection of
individuals into informal employment, I use a rich set of control variables representing several individual characteristics.
Findings: After controlling for observed heterogeneity, I find that on average informal workers earn less than formal workers, both in terms of monthly earnings and hourly wage. This result is not sensitive to the definition of informal employment used and is
stable over the analysed time period (2009–2017). However, the wage penalty to informal employment is substantially higher for individuals at the bottom of the wage distribution, which supports the hypothesis of the two-tier structure of the informal labour market in Poland.
Originality/value: The main contribution of this study is that it identifies the two-tier structure of the informal labour market in Poland: informal workers in the first quartile of the wage distribution and those above the first quartile appear to be in two partially different segments of the labour market.
This document provides a comparative analysis of the rule of law and its impact on economic development in Poland and Germany. It finds that while both countries have strong rule of law frameworks de jure, there are significant differences de facto, with Polish firms showing less trust in the state and courts compared to German firms. Empirical analysis suggests higher levels of investment and economic development in Germany can be partially attributed to firms' greater recognition of the rule of law's ability to reduce transaction costs. Erosion of the rule of law in Poland since 2015 has likely negatively impacted investment and capital accumulation compared to Germany.
The report analyzes the VAT gap in the EU-28 member states in 2018. It finds that the total VAT gap in the EU was an estimated €137 billion, representing 12.2% of the total VAT liability. This is an increase compared to 2017, when the gap was €117 billion or 11.2% of the total liability. The report examines VAT revenue, total VAT liability, and VAT gap estimates for each member state from 2014 to 2018. It also conducts econometric analysis to identify factors influencing VAT gap levels across countries.
The euro is the second most important global currency after the US dollar. However, its international role has not increased since its inception in 1999. The private sector prefers using the US dollar rather than the euro because the financial market for US dollar-denominated assets is larger and deeper; network externalities and inertia also play a role. Increasing the attractiveness of the euro outside the euro area requires, among others, a proactive role for the European Central Bank and completing the Banking Union and Capital Market Union.
Forecasting during a strong shock is burdened with exceptionally high uncertainty. This gives rise to the temptation to formulate alarmist forecasts. Experiences from earlier pandemics, particularly those from the 20th century, for which we have the most data, don’t provide a basis for this. The mildest of them weakened growth by less than 1 percentage point, and the worst, the Spanish Flu, by 6 percentage points. Still, even the Spanish Flu never caused losses on the order of 20% of GDP – not even where it turned out to be a humanitarian disaster, costing the lives of 3-5% of the population. History suggests that if pandemics lead to such deep losses at all, it’s only in particular quarters and not over a whole year, as economic activity rebounds. The strength of that rebound is largely determined by economic policy. The purpose of this work is to describe possible scenarios for a rebound in Polish economic growth after the epidemic.
A separate issue, no less important, is what world will emerge from the current crisis. In the face of the 2008 financial crisis, White House Chief of Staff Rahm Emanuel said: “You never want a serious crisis to go to waste. And what I mean by that is an opportunity to do things that you think you could not do before.” Such changes can make the economy and society function better than before the crisis. Unfortunately, the opportunities created by the global financial crisis were squandered. Today’s task is more difficult; the scale of various problems has expanded even more. Without deep structural and institutional changes, the world will be facing enduring social and economic problems, accompanied by long-term stagnation.
"Many brilliant prophecies have appeared for the future of the EU and our entire planet. I believe that Europe, in its own style, will draw pragmatic conclusions from the crisis, not revolutionary ones; conclusions that will allow us to continue enjoying a Europe without borders. Brussels will demonstrate its usefulness; it will react ably and flexibly. First of all, contrary to the deceitful statements of members of the Polish government, the EU warned of the threats already in 2021. Secondly, already in mid-March EU assistance programs were ready, i.e. earlier than the PiS government’s “shield” program. The conclusion from the crisis will be a strengthening of all the preventive mechanisms that allow us to recognize threats and react in time of need. Research programs will be more strongly directed toward diagnosing and treating infectious diseases. Europe will gain greater self-sufficiency in the area of medical equipment and drugs, and the EU – greater competencies in the area of the health service, thus far entrusted to the member states. The 2021-27 budget must be reconstructed, to supplement the priority of the Green Deal with economic stimulus programs. In this way structural funds, which have the greatest multiplier effect for investment and the labor market, may return to favor. So once again: an addition, as a conclusion from the crisis, and not a reinvention of the EU," writes Dr. Janusz Lewandowski the author of the 162nd mBank-CASE seminar Proceeding.
Dla wielu rodaków europejskość Polski jest oczywista, trudno jest im nawet wyobrazić sobie, jak kształtowałyby się losy naszego kraju bez uczestnictwa w integracji europejskiej. Szczególnie młode pokolenie traktuje osiągnięty przez nas dzięki uczestnictwie w Unii ogromny postęp cywilizacyjny jako coś danego i naturalnego. Jednak świadomość tego, jaki był nasz punkt wyjścia, jaką przeszliśmy drogę i jak przyczyniły się do tego unijne działania oraz jakie wynikały z tego korzyści powinna nam stale towarzyszyć. Bez tej świadomości, starannego weryfikowania faktów i docenienia naszych osiągnięć grozi nam uleganie niesprawdzonym argumentom przeciwników integracji europejskiej i popełnienie nieodwracalnych błędów. Dla tych, którzy chcą poznać te fakty, przygotowany został raport "Nasza Europa. 15 lat Polski w Unii Europejskiej". Podjęto w nim ocenę 15 lat członkostwa Polski z perspektywy doświadczeń procesu integracji, z jego barierami i sukcesami, a także wyzwaniami przyszłości.
Raport jest wynikiem pracy zbiorowej licznych ekspertów z różnych dziedzin, od wielu lat analizujących wielowymiarowe efekty działania instytucji UE oraz współpracy z krajami członkowskimi na podstawie europejskich wartości i mechanizmów. Autorzy podsumowują korzyści członkostwa Polski w Unii Europejskiej na podstawie faktów, nie stroniąc jednakże od własnych ocen i refleksji.
This report is the result of the joint work of a number of experts from various fields who have been - for many years – analysing the multidimensional effects of EU institutions and cooperation with Member States pursuant to European values and mechanisms. The authors summarise the benefits of Poland’s membership in the EU based on facts; however, they do not hide their own views and reflections. They also demonstrate the barriers and challenges to further European integration.
This report was prepared by CASE, one of the oldest independent think tanks in Central and Eastern Europe, utilising its nearly 30 years of experience in providing objective analyses and recommendations with respect to socioeconomic topics. It is both an expression of concern about Poland’s future in the EU, as well as the authors’ contribution to the debate on further European integration.
Poland’s new Employee Capital Plans (PPK) scheme, which is mandatory for employers, started to be implemented in July 2019. The article looks at the systemic solutions applied in the programme from the perspective of the concept of the simultaneous reconstruction of the retirement pension system. The aim is to present arguments for and against the project from the point of view of various actors, and to assess the chances of success for the new system. The article offers a detailed study of legal solutions, an analysis of the literature on the subject, and reports of institutions that supervise pension funds. The results of this analysis point to the lack of cohesion between certain solutions of the 1999 pension reform and expose a lack of consistency in how the reform was carried out, which led to the eventual removal of the capital part of the pension system. The study shows that additional saving for old age is advisable in the country’s current demographic situation and necessary for both economic and social reasons. However, the systemic solutions offered by the government appear to be chiefly designated to serve short-term state interests and do not create sufficient incentives for pension plan participants to join the programme.
The document summarizes the evolution of the Belarusian public sector from a command economy to state capitalism. It discusses how the Belarusian economic model has changed over time, moving from a quasi-Soviet system based on state property and central planning, to a more flexible hybrid model where the public sector still dominates the economy. The paper analyzes the role and characteristics of the state sector in Belarus and how it has developed since independence. It considers various theoretical perspectives for understanding statist economies like Belarus, but concludes that a new multidisciplinary approach is needed to fully capture the dual nature of the Belarusian economic system.
Belarusian economy has been stagnating in 2011-2015 after 15 years of a high annual average growth rate. In 2015, after four years of stagnation, the Belarusian economy slid into a recession, its first since 1996, and experienced both cyclical and structural recessions. Since 2015, the Belarusian government and the National Bank of Belarus have been giving economic reforms a good chance thanks to gradual but consistent actions aimed at maintaining macroeconomic stability and economic liberalization. It seems that the economic authorities have sustained more transformation efforts during 2015-2018 than in the previous 24 years since 1991.
As the relative welfare level in Belarus is currently 64% compared to the Central and Eastern Europe (CEE) countries average, Belarus needs to build stronger fundaments of sustainable growth by continuing and accelerating the implementation of institutional transformation, primarily by fostering elimination of existing administrative mechanisms of inefficient resource allocation. Based on the experience of the CEE countries’ economic transformation, we highlight five lessons for the purpose of the economic reforms that Belarus still faces today: keeping macroeconomic stability, restructuring and improving the governance of state-owned enterprises, developing the financial market, increasing taxation efficiency, and deepening fiscal decentralization.
Inflation in advanced economies is low by historical standards but there is no threat of deflation. Slower economic growth is caused by supply-side constraints rather than low inflation. Below-the-target inflation does not damage the reputation of central banks. Thus, central banks should not try to bring inflation back to the targeted level of 2%. Rather, they should revise the inflation target downwards and publicly explain the rationale for such a move. Risks to the independence of central banks come from their additional mandates (beyond price stability) and populist politics.
Estonia has Europe’s most transparent tax system (while Poland is second-to-last, in 35th place), and is also known for its pioneering approach to taxation of legal persons’ income. Since 2000, payers of Estonian corporate tax don’t pay tax on their profits as long as they don’t realize them. In principle, this approach should make access to capital easier, spark investment by companies and contribute to faster economic growth. Are these and other positive effects really noticeable in Estonia? Have other countries followed in this country’s footsteps? Would deferment of income tax be possible and beneficial for Poland? How would this affect revenue from tax on corporate profits? Would investors come to see Poland as a tax haven? Does the Estonian system limit tax avoidance and evasion, or actually the opposite? Is such a system fair? Are intermediate solutions possible, which would combine the strengths or limit the weaknesses of the classical and Estonian models of profit tax? These questions are discussed in the mBank-CASE seminar Proceeding no. 163, written by Dmitri Jegorov, deputy general secretary of the Estonian Finance Ministry, who directs the country’s tax and customs policy, Dr. Anna Leszczyłowska of the Poznań University of Economics and Business and Aleksander Łożykowski of the Warsaw School of Economics.
The trade war between the U.S. and China began in March 2018. The American side raised import duties on aluminum and steel from China, which were later extended to other countries, including Canada, Mexico and the EU member states. This drew a negative reaction from those countries and bilateral negotiations with the U.S. In June 2018 America, referring to Section 301 of its 1974 Trade Act, raised tariffs to 25% on 818 groups of products imported from China, arguing that the tariff increase was a response to years of theft of American intellectual property and dishonest trade practices, which has caused the U.S. trade deficit.
Will this trade war mean the collapse of the multilateral trading system and a transition to bilateral relationships? What are the possibilities for increasing tariffs in light of World Trade Organization rules? Can the conflict be resolved using the WTO dispute-resolution mechanism? What are the consequences of the trade war for American consumers and producers, and for suppliers from other countries? How high will tariffs climb as a result of a global trade war? How far can trade volumes and GDP fall if the worst-case scenario comes to pass? Professor Jan J. Michałek and Dr. Przemysław Woźniak give answers to these questions in the mBank-CASE Seminar Proceeding No. 161.
This Report has been prepared for the European Commission, DG TAXUD under contract TAXUD/2017/DE/329, “Study and Reports on the VAT Gap in the EU-28 Member States” and serves as a follow-up to the six reports published between 2013 and 2018.
This Study contains new estimates of the Value Added Tax (VAT) Gap for 2017, as well as updated estimates for 2013-2016. As a novelty in this series of reports, so called “fast VAT Gap estimates” are also presented the year immediately preceding the analysis, namely for 2018. In addition, the study reports the results of the econometric analysis of VAT Gap determinants initiated and initially reported in the 2018 Report (Poniatowski et al., 2018). It also scrutinises the Policy Gap in 2017 as well as the contribution that reduced rates and exemptions made to the theoretical VAT revenue losses.
More from CASE Center for Social and Economic Research (20)
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
OJP data from firms like Vicinity Jobs have emerged as a complement to traditional sources of labour demand data, such as the Job Vacancy and Wages Survey (JVWS). Ibrahim Abuallail, PhD Candidate, University of Ottawa, presented research relating to bias in OJPs and a proposed approach to effectively adjust OJP data to complement existing official data (such as from the JVWS) and improve the measurement of labour demand.
Solution Manual For Financial Accounting, 8th Canadian Edition 2024, by Libby...Donc Test
Solution Manual For Financial Accounting, 8th Canadian Edition 2024, by Libby, Hodge, Verified Chapters 1 - 13, Complete Newest Version Solution Manual For Financial Accounting, 8th Canadian Edition by Libby, Hodge, Verified Chapters 1 - 13, Complete Newest Version Solution Manual For Financial Accounting 8th Canadian Edition Pdf Chapters Download Stuvia Solution Manual For Financial Accounting 8th Canadian Edition Ebook Download Stuvia Solution Manual For Financial Accounting 8th Canadian Edition Pdf Solution Manual For Financial Accounting 8th Canadian Edition Pdf Download Stuvia Financial Accounting 8th Canadian Edition Pdf Chapters Download Stuvia Financial Accounting 8th Canadian Edition Ebook Download Stuvia Financial Accounting 8th Canadian Edition Pdf Financial Accounting 8th Canadian Edition Pdf Download Stuvia
In a tight labour market, job-seekers gain bargaining power and leverage it into greater job quality—at least, that’s the conventional wisdom.
Michael, LMIC Economist, presented findings that reveal a weakened relationship between labour market tightness and job quality indicators following the pandemic. Labour market tightness coincided with growth in real wages for only a portion of workers: those in low-wage jobs requiring little education. Several factors—including labour market composition, worker and employer behaviour, and labour market practices—have contributed to the absence of worker benefits. These will be investigated further in future work.
[4:55 p.m.] Bryan Oates
OJPs are becoming a critical resource for policy-makers and researchers who study the labour market. LMIC continues to work with Vicinity Jobs’ data on OJPs, which can be explored in our Canadian Job Trends Dashboard. Valuable insights have been gained through our analysis of OJP data, including LMIC research lead
Suzanne Spiteri’s recent report on improving the quality and accessibility of job postings to reduce employment barriers for neurodivergent people.
Decoding job postings: Improving accessibility for neurodivergent job seekers
Improving the quality and accessibility of job postings is one way to reduce employment barriers for neurodivergent people.
South Dakota State University degree offer diploma Transcriptynfqplhm
办理美国SDSU毕业证书制作南达科他州立大学假文凭定制Q微168899991做SDSU留信网教留服认证海牙认证改SDSU成绩单GPA做SDSU假学位证假文凭高仿毕业证GRE代考如何申请南达科他州立大学South Dakota State University degree offer diploma Transcript
^%$Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Duba...mayaclinic18
Whatsapp (+971581248768) Buy Abortion Pills In Dubai/ Qatar/Kuwait/Doha/Abu Dhabi/Alain/RAK City/Satwa/Al Ain/Abortion Pills For Sale In Qatar, Doha. Abu az Zuluf. Abu Thaylah. Ad Dawhah al Jadidah. Al Arish, Al Bida ash Sharqiyah, Al Ghanim, Al Ghuwariyah, Qatari, Abu Dhabi, Dubai.. WHATSAPP +971)581248768 Abortion Pills / Cytotec Tablets Available in Dubai, Sharjah, Abudhabi, Ajman, Alain, Fujeira, Ras Al Khaima, Umm Al Quwain., UAE, buy cytotec in Dubai– Where I can buy abortion pills in Dubai,+971582071918where I can buy abortion pills in Abudhabi +971)581248768 , where I can buy abortion pills in Sharjah,+97158207191 8where I can buy abortion pills in Ajman, +971)581248768 where I can buy abortion pills in Umm al Quwain +971)581248768 , where I can buy abortion pills in Fujairah +971)581248768 , where I can buy abortion pills in Ras al Khaimah +971)581248768 , where I can buy abortion pills in Alain+971)581248768 , where I can buy abortion pills in UAE +971)581248768 we are providing cytotec 200mg abortion pill in dubai, uae.Medication abortion offers an alternative to Surgical Abortion for women in the early weeks of pregnancy. Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Dubai Abu Dhabi Sharjah Deira Ajman Fujairah Ras Al Khaimah%^^%$Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Dubai Abu Dhabi Sharjah Deira Ajman Fujairah Ras Al Khaimah%^^%$Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Dubai Abu Dhabi Sharjah Deira Ajman Fujairah Ras Al Khaimah%^^%$Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Dubai Abu Dhabi Sharjah Deira Ajman Fujairah Ras Al Khaimah%^^%$Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Dubai Abu Dhabi Sharjah Deira Ajman Fujairah Ras Al Khaimah%^^%$Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Dubai Abu Dhabi Sharjah Deira Ajman Fujairah Ras Al Khaimah%^^%$Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Dubai Abu Dhabi Sharjah Deira Ajman Fujairah Ras Al Khaimah%^^%$Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Dubai Abu Dhabi Sharjah Deira Ajman Fujairah Ras Al Khaimah%^^%$Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Dubai Abu Dhabi Sharjah Deira Ajman Fujairah Ras Al Khaimah%^^%$Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Dubai Abu Dhabi Sharjah Deira Ajman Fujairah Ras Al Khaimah%^^%$Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Dubai Abu Dhabi Sharjah Deira Ajman Fujairah Ras Al Khaimah%^^%$Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Dubai Abu Dhabi Sharjah Deira Ajman Fujairah Ras Al Khaimah%^^%$Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Dubai Abu Dhabi Sharjah Deira Ajman Fujairah Ras Al Khaimah%^^%$Zone1:+971)581248768’][* Legit & Safe #Abortion #Pills #For #Sale In #Dubai Abu Dhabi Sharjah Deira Ajman
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
How Does CRISIL Evaluate Lenders in India for Credit RatingsShaheen Kumar
CRISIL evaluates lenders in India by analyzing financial performance, loan portfolio quality, risk management practices, capital adequacy, market position, and adherence to regulatory requirements. This comprehensive assessment ensures a thorough evaluation of creditworthiness and financial strength. Each criterion is meticulously examined to provide credible and reliable ratings.
The Universal Account Number (UAN) by EPFO centralizes multiple PF accounts, simplifying management for Indian employees. It streamlines PF transfers, withdrawals, and KYC updates, providing transparency and reducing employer dependency. Despite challenges like digital literacy and internet access, UAN is vital for financial empowerment and efficient provident fund management in today's digital age.
3. CASE Network Studies & Analyses No.406 The Gender Pay Gap in Informal Employment…
2
Contents
Abstract .....................................................................................................................................4
1. Introduction .........................................................................................................................5
2. Literature Review.................................................................................................................6
2.1. Gender wage gap..........................................................................................................6
2.2. Informal economy.........................................................................................................9
3. Data And Methodology......................................................................................................14
3.1. Data ...............................................................................................................................14
3.2. Methodology .................................................................................................................15
4. Results .................................................................................................................................20
4.1. Descriptive statistics....................................................................................................20
4.2. Earnings inequality.......................................................................................................23
4.3. Quantile Regression.....................................................................................................25
5. Conclusions.........................................................................................................................32
References...............................................................................................................................34
Appendix..................................................................................................................................39
4. CASE Network Studies & Analyses No.406 The Gender Pay Gap in Informal Employment…
Magdalena Rokicka is an economist, currently a candidate for Ph. D at the Institute for Social
and Economic Research (Essex University). She holds a MA degree in economics from Warsaw
University, and has obtained a postgraduate study diploma in Cross-Cultural Studies. She has
worked for CASE-Center for Social and Economic Research since 2004, participating in its
numerous projects including: Poland's Shadow Economy: its size, characteristics and social
consequences, ESCIRRU (Economic and Social Consequences of Industrial Restructuring in
Russia and Ukraine, ENEPO (The Eastern Neighbourhood: Economic Potential and Future
Development), Mobility of Polish Researcher. Her current research interests are mainly in the
area of labour market economics, including : gender related aspects of labour market, family
and work- life balance, self-employment creation, and informal employment . She is fluent in
English and French and has a working knowledge of Russian language.
Anna Ruzik, Ph.D, is an expert and author of publications in the fields of labour economics and
social policy. Since 2004, she has been participating in numerous research projects carried out
by CASE. Dr. Ruzik is employed as an assistant professor at the Warsaw School of Economics
and at the Institute of Labour and Social Studies in Warsaw.
3
5. CASE Network Studies & Analyses No.406 The Gender Pay Gap in Informal Employment…
4
Abstract
This paper addresses the issue of the gender pay gap in the formal and informal labour markets
in Poland. The authors verify the hypothesis of the existence of a gender pay gap in informal
work and compare this gap with the one observed in the formal (registered) labour market.
Various analyses of available data show that size and characteristics of gender pay gap differ
depending on the level of earnings. The inequality of earnings among unregistered women and
men is more pronounced at the bottom tail of the earnings distribution. In the case of formal
employees, inequality at the top of the distribution tends to be larger, confirming the existence of
a ‘glass ceiling’.
The decomposition of the gender pay gap for selected quintiles indicates that it would be even
higher if women had men’s characteristics.
A possible explanation of the results is the lack of minimum wage regulations in the informal
market and the greater flexibility in agreement on wages in the higher quantiles.
6. CASE Network Studies & Analyses No.406 The Gender Pay Gap in Informal Employment…
5
1. Introduction
In the expanding stream of economic literature on gender aspects of the labour market, scant
attention is given to the empirical analysis of male and female earnings differences in informal
work. Even less can be found in terms of empirical analyses for the so called transition
countries of Central and Eastern Europe. Furthermore, no specific analyses on the gender pay
gap have been carried out in the transition economies in the context of differences between the
formal and informal labour markets.
The main purpose of our study is to analyse if informal labor has any impact on the gender pay
gap in Poland. Specifically, we will:
· verify the hypothesis of the existence of a gender pay gap in informal (unregistered)
employment,
· check if it is larger or smaller than that in the formal (registered) labour market,
· try to explain possible differences between pay gaps in the two labour markets.
The paper has the following structure. First, we present the literature review and general findings
on the gender pay gap in developed countries, followed by a review of the gender pay gap
specifically in Poland, and finally on the economics of the informal labour market. Section III
describes the dataset used and the methodology chosen for the analyses. That leads to the
presentation in Section IV of the results of the analyses of wage distribution, as well as returns
to different characteristics for female and male participants of the formal and informal labour
market. Section V concludes and discusses possible further research. The last parts of the
paper are appendixes and a list of cited literature.
7. CASE Network Studies & Analyses No.406 The Gender Pay Gap in Informal Employment…
6
2. Literature Review
2.1. Gender wage gap
Gender wage discrimination and the size of the gender pay gap are frequently researched fields
in labour economics. The growing importance of this issue can be seen by its presence in the
major labour economics textbooks (Ashenfelter and Card (ed.), 1999; Bosworth et al., 1996,
Cahuc and Zyberberg, 2004).
Apart from pure discrimination, the wage rates of women and men also differ because of non-discriminatory
factors connected with e.g. the generally shorter work experience of females due
to different family duties (see e.g. O’Neill 2003). Altonji and Blank (1999) show that differences in
earnings (and also in occupation and employment patterns) may result from differences in
unobservable characteristics like preferences and skills, rather than discrimination.
Numerous empirical studies have been conducted to analyse the size of an earnings gap
between women and men, and to estimate to what extent the gap results from differences in
education, tenure, age, experience and to what extent it results from returns to observable
characteristics in favour of men i.e. if it is an effect of discrimination. (e.g. Blau, 2000).
Our review of empirical findings supports the trend of a decline in gender wage discrimination
since the 1960s in industrialized countries. An international analysis by Weichselbaumer and
Winter-Ebmer (2005) indicates a decrease in the gender wage differential from about 65 percent
in the 1960s to 30 percent in the 1990s in favour of men. That may reflect progress in women’s
education and increased job experience, as well as the broad introduction of non-discrimination
regulations. The meta regression analysis carried out by Jarrel and Stanley (2004) also showed
a strong trend for the estimates of wage discrimination to decline. Interestingly, it seems that
there is a tendency for male researchers to report larger discrimination estimates.
The hypothesis that the institutional framework of a specific labour market and regulations
concerning compensation matter for the gender pay gap was confirmed in a number of papers.
Elvira and Graham (2002), in their paper on the relationship between pay system formalization
and gender earnings effects, used personnel data from Fortune 500 financial corporations to
show the existence of a negative relationship between earnings and the proportion of females in
a job. This finding supports the conclusions of other researchers (e.g. England et al., 1988) that
8. CASE Network Studies & Analyses No.406 The Gender Pay Gap in Informal Employment…
the higher the proportion of women in a job, the lower the earnings for both women and men in
that job. Larger gender-related earnings differences in the same job have been found in
companies where bonus programs (apart from the basic wage) exist.
Results of models based on microdata for 22 countries over the 1985-94 period by Blau and
Kahn (2003) show that an overall wage compression and a low female labour supply relative to
demand reduce a country’s gender pay gap. Additionally, wage-setting mechanisms, such as
collective bargaining agreements that result in relatively high wage floors, raise the relative pay
of women.
It would be also interesting to explore the effect of competition on the wage gap between men
and women. Does market competition tend to reduce discrimination by employers?
Weichselbaumer and Winter-Ebmer (2007) describe different theories on discrimination that
show that more competition may or may not lead to a reduction in gender wage gaps. A number
of studies have indeed found a negative relationship between competition and the gender wage
gap at the industry or firm level. On the other hand, gender differences with respect to
competitive behaviour may explain part of the male-female wage differential leading to higher
wage differentials given higher competitive pressure.
This poses an interesting research question on whether a more competitive shadow economy
labour market would cause more or less gender pay discrimination. Due to greater family duties,
women are usually more interested in having flexible work hours. This trend could have an effect
on their preferences towards informal work and the earnings they are willing to accept in such
employment.
As the main part of our empirical work in this paper is for Poland, let us now have a closer look
at the size of the gender pay gap in countries that started to transition from centrally planned
economies to market economies in the beginning of the 1990s. For this area, the economic
literature is smaller but still expanding, see e.g. Jurajda (2003), Adamchik and Bedi (2003),
Newell and Reilly (2001), or Brainerd (2000).
It is a well known fact in transition economies that the distribution of income has become more
concentrated since the beginning of 1990s. Growing differences between income levels have
brought inequality coefficients closer to that of the OECD countries (see e.g. Milanovic 1997).
This was caused on one hand by the restructuring of sectors, lay-offs, and the emergence of
open unemployment, and on the other hand by a closer link (at least in the private sector)
between productivity and wages. Analyses conducted by the European Foundation (2005) point
to an observed improvement in the gender pay ratio since the pre-transition period for certain
7
9. CASE Network Studies & Analyses No.406 The Gender Pay Gap in Informal Employment…
Central and Eastern European countries and a slowdown of this improvement in recent years
with variation between countries. Paci (2002) discusses changes in the labour market caused by
the transition in countries of Europe and Central Asia. Despite the crude pay gap decline in the
first years of the transition in the region, preliminary empirical evidence for some countries
suggests there is still a high degree of wage discrimination.
In Poland, basic stylised facts on differences in monthly full-time gross wages in the official
labour market can be derived from the biannual survey on wages in companies employing 9 or
more workers. In 1996-2006, at least in the formal labour market, the factors that most
differentiated wages that women and men earned were: education (with the highest difference in
favour of men among employees with tertiary education) and type of occupation (with clerks and
office workers as the relatively most “equal” groups and senior officials and professionals as the
group with the highest gender pay gap). Age was less important as far as the gender pay was
concerned1.
More comprehensive studies for Poland also show that the gender pay gap declined at the
beginning of the period of transition compared to its pre-transitional level, and that it has
remained more or less stable since that time. Grajek (2001) investigated the earnings gap
between women and men in Poland over the years 1987-1996 (using Household Budget Survey
individual data) and suggested that women gained in the very first years of transition. The
difference in log percentage points of the gender wages decreased from 34.5 in 1987 to 24.3 per
cent in 1996. Adamchik and Bedi (2003) used Labour Force Survey individual data for the years
1993-97. In this period the gender wage gap ceteris paribus was at a similar level of 22-23
percent and most of the explained gap was due to industrial and occupational segregation.
Marcinkowska (2005) focused on specific groups within the labour force. She analysed the
gender wage gap among young people in Poland (aged 18-29) and found that young women
aged 25-29 earn less by about 15.2 percent than men. The comparable figure is lower among
workers aged 18-24, amounting to 12.6 percent.
Marcinkowska et al. (2008) also studied changes in the wage structure in Poland in the years
1996-2006 using different labour market and individual characteristics. They based their
estimates on two data sources: the biannual Central Statistical Office survey of gross wages in
companies employing 9 or more employees and on the Labour Force Survey information on net
wages. The authors found that pay differentiation between females and males decreased in the
1 Based on data from the biannual wage survey conducted by the Central Statistical Office of Poland, available at
www.stat.gov.pl.
8
10. CASE Network Studies & Analyses No.406 The Gender Pay Gap in Informal Employment…
described period. That confirms results of earlier analyses by e.g. Newell and Reilly (2001). The
between-sex differentiation is lower and decreasingly important as an explanation of all wage
differentiation in Poland.
Newell and Socha (2005), on the basis of quantile analyses using LFS data for 1992–2002,
showed that many of the factors influencing wages, including gender, have a stronger impact in
higher quintiles for higher wages. This suggests that women are discriminated mainly in jobs or
positions with a relatively better pay.
9
2.2. Informal economy
One of the motivations of our study originates from differences in the formal and informal
economy. As argued by Renooy (1990), the informal economy: lacks formal regulations and
laws, is perceived as more flexible than the formal economy, interacts with the formal economy,
is highly fragmented (functioning only in certain specific areas), relies predominantly on
social/family networks, and has a low entry threshold.
Research on the informal economy tends to focus mainly on its macroeconomic aspects.
Socioeconomic, institutional, and political factors are analysed in order to establish a causal
relation between levels of development, taxation, legislation, protective labour policy, and the
existence of informality in the economy (Chong et al., 2007; Johansson, 2009; Karlinger, 2009;
Maloney 2004). Furthermore, the lack of appropriate data results in a number of studies aimed
at estimations of the size and scope of the informal market (Frey et al., 1983; Schneider and
Enste, 2000).
Micro-level analysis is mostly limited by the unwillingness of respondents to openly admit
engaging in unofficial activities, which results in a shortage of reliable data (Jutting et al., 2008).
Another issue in micro analyses arises from the variety of alternative definitions of informal
economy, which makes comparison of empirical studies quite complex and, as shown by Henley
et al. (2006), it could lead to contradicting conclusions.
According to the conventional approach of labour market segmentation, informal workers do not
compete with formal workers, as they belong to a ‘secondary sector’. This sector is
characterised by low-skilled and unstable jobs with low wages and poor working conditions. Yet,
recently, a new approach has been suggested. The argument has been put forth that informal
employment is a free choice, and those who work in the informal sector are maximising their
utility, weighing the costs and benefits of these two sectors (Perry et al., 2007). Fields (2005)
11. CASE Network Studies & Analyses No.406 The Gender Pay Gap in Informal Employment…
builds on those two approaches and distinguishes between an ‘upper tier’ and a ‘lower tier’. The
“upper tier” comprises the competitive part, i.e. those who voluntarily choose to be informal, and
the “lower tier” is the part that consists of individuals who cannot afford to be unemployed but
have no hope to get a formal job (Fields, 2005). Similar heterogeneity among those voluntary
and involuntary workers was also reported by Henley at al. (2006) and (Perry et al., 2007).
In line with this approach were studies of the impact of minimum wage on informal employment.
The theoretical model suggested by Fiszbein (1992) shows that a decrease in minimum wage
does not necessary imply benefits for informal employees. Empirical evidence for Costa Rica by
Terrell et al. (2001) also gives a mixed picture. On the one hand, the evidence shows that a unit
increase in the minimum wage is associated with an increase in the average number of hours
worked per week by 0.14 percent in the formal sector and 0.34 percent in the informal sector. On
the other hand, the authors do not find supportive evidence to indicate that an increase in the
minimum wage has any impact on the size of the informal sector (measured by the number of
informal workers).
According to empirical studies, the probability of participating in the informal sector is also
determined by socio-demographic factors such as age, level of education, gender, and marital
status. As summed up by Jutting et al., (2008) individuals enter the informal market in certain
moments of their lives. They may start their careers in the informal market in order to gain
valuable experience and then move to formal employment, and, as some studies suggest, they
may return to the informal market again when they are older. One’s marital status and gender
also have a considerable impact on choice of sector. Heads of households and single women
are more often found among formal employees, while dependent household members,
especially in households with young children, are more likely to work informally (Perry et al.
2007).
A review of the literature reveals some interesting gender patterns of informal employment.
In developing countries, women outnumber men in the informal sector as a consequence of the
underdevelopment of local labour markets (Maloney 2004). As it is argued by Cunningham
(2001) that this disproportion may be also a result of women’s choice, especially if they care for
small children, and is motivated by the flexibility of jobs offered in the informal sector. Results for
Ukraine for a 2005 study presented by Williams et al. (2008) are consistent with two of the
studies above: almost 64 per cent of Ukrainian women participated in the informal market in the
previous year compared to 59 per cent of men.
10
12. CASE Network Studies & Analyses No.406 The Gender Pay Gap in Informal Employment…
However, empirical studies for EU Member States do not confirm this pattern. In developed
countries, women tend to participate less than men in undeclared work. As stated in the EC
report on undeclared work (Renooy et al., 2004): ‘in Denmark, almost three times more men
than women carry out undeclared work (29.4 % and 11.5 %, respectively). In Germany, Sweden
and the UK, male participation is generally twice as high: 14.5 % and 6.5 % respectively in
Germany, 15.4 % and 7 % in Sweden and 10.3 % and 5.4 % in UK.’
Also Andresen et al. (2005), using repeated survey data for Norway, confirm a substantial
overrepresentation of males in the informal market as they found that the probability of having
an unreported income is higher among men than women. Moreover, they point out that between
1980 and 2003, a significant number of women left the shadow economy, while the population of
men working without registration remained relatively unchanged. They explain this trend by the
increase in female participation in the formal market, the introduction of a more generous
maternity leave scheme, and the development of subsidized public childcare institutions2.
An interesting insight into labour market transitions (public, private, informal, and out of work) is
provided by Dimova et al. (2005) in their analysis for Bulgaria during the economic crisis. The
authors report a higher conditional probability of moving from the public to the informal sectors
for women (0.707) than for men (0.564), and find the same trend in the case of the transition
from the private formal sector into informal employment. Also Perry et al. (2007) claim higher
mobility between being out of work to informal self-employment for women as compared to men,
and point out that it is mainly due to the high participation of married women with children in this
sector.
Women’s participation in the informal economy in the context of family obligations is discussed
by Leonard (1998). She argues that childcare shapes determinants of female labour market
participation, though women often agree to do lower-paid and precarious jobs, which are mainly
provided on an unregulated basis. Pfau-Effinger (2009) further develops this concept. She
expresses the view that female participation in informal work is related to the different forms of
welfare state regimes. In a social democratic system, which provides adequate social coverage
(child care, elderly care, etc.), the need for female undeclared work is minimal. While in a
conservative welfare regime (for example Germany), the demand for domestic labour
considerably increases the number of people in the informal market, especially within the
household sector. In regards to the ‘Latin Rim’ she argues that cultural norms and ethics
2 As a result, demand for private predominantly unreported child care decreased.
11
13. CASE Network Studies & Analyses No.406 The Gender Pay Gap in Informal Employment…
discourage women, especially mothers with young children, from participating in the formal
labour market.
Not only has the participation rate in the informal sector indicated a clear division between
genders, the nature and characteristics of informal jobs differ too. Women work mainly in more
regular, but part-time jobs in sectors with traditional female overrepresentation (cleaning,
personal care, hotels and restaurant, etc.), which provide only supplements to family income
(Williams et al., 2008; Jutting et al., 2008; Renooy et al., 2004).
Scarce empirical evidence confirms the existence of a gender earnings gap in the informal
economy. Specifically Williams et al. (2008), using Ukrainian data for 2005, show that women
tend to receive on average 67% of the earning rate of men in the informal sector. Renoy et al.
(2004) also report than in the Netherlands, men earn on average 50% more per hour than
women do. Similar findings are shown for Latin America, where women earn on average 52% of
men’s earning rates, and this gap is larger than in the formal sector (64%) (Silveira and Matosas,
2005). However, as argued by Silveira and Matosas (2005), there is evidence of a diminishing
gender pay gap in the informal sector in this region.
According to special modules of the Polish Labour Force Survey on informal work conducted in
1998 and 2004 by the Central Statistical Office, the size of the informal sector in Poland is
diminishing (GUS 2004). However, in 2004, still around 9.6 per cent of the working population
was engaged in either full-time or temporary informal jobs. The main reasons for choosing the
informal sector as indicated by respondents were: the need to have any kind of income, the lack
of jobs opportunities in the formal sector, and the aspiration to have higher income than in formal
jobs. There were evident disparities in answers depending on the place of residence: town or
village, and gender. Jobs in the informal sector tend to be concentrated in the construction and
repairs, trade, private tutorial, and child care sectors. For 60 per cent of respondents, informal
work was their main source of income.
Women represented 37 per cent of informal employees. Furthermore, women tended to work in
the informal sector mostly in the middle of their carrier (35-45 years old). There were also visible
gender disparities with regards to the education level. Women tended to be better educated than
men, although the most numerous workers had only vocational education, regardless of gender
(69 per cent of informal workers had vocational education). According to 2004 data, there was a
considerable gender pay gap in favour of men. Women earned 79 per cent of men’s monthly
earnings, but because of the differences in work characteristics (full-time, part time, etc.) and the
12
14. CASE Network Studies & Analyses No.406 The Gender Pay Gap in Informal Employment…
unwillingness of respondents to provide accurate information, these results should be treated
with caution.
The informal sector seems to provide certain benefits as well as disadvantages. As summarized
by Jutting et al. (2008), the most common risks associated with informal work are:
· uncertainty and vulnerability,
· lack of social benefits related to formal work,
· worse and uncontrollable working conditions,
· potential fine.
13
While potential benefits are be as follows:
· higher pay,
· greater flexibility and autonomy,
· learning by doing and training opportunities (especially for young unskilled workers),
· free access to public goods.
Based on the above literature and empirical studies of the informal sector in both well developed
Western countries and in developing regions, we are able to formulate certain hypotheses,
which we can then test further using Polish data.
We expect that the gender pay gap in the informal, usually more competitive, unregulated
market differs from the gender pay gap in the formal sector. There are two main factors which
could have an impact on the earnings gap. First, based on previous studies, we can expect that
legal regulations will result in a lower gender pay gap in the formal economy as reported for
Ukraine (Williams et al., 2008), Netherlands (Renooy et al., 2004) and Mexico (Silveira and
Matosas, 2005). On the other hand, higher job flexibility, the autonomy of the informal market,
and the lack of regulation gives potential employees (including women) higher bargaining power,
which may result in a smaller earnings gap in this market. The final outcome is a result of these
two opposing forces. Taking the above reported heterogeneity of the informal market, we can
suppose that these factors play different roles in voluntary and involuntary informal jobs. In
voluntary jobs, bargaining power or more efficient use of special skills and ability, could lead to a
better position for women in the informal labour market. In contrast, low skilled involuntary jobs
in the informal sector do not provide such opportunities. Using several econometric approaches,
we will address these questions in the next part of our paper.
15. CASE Network Studies & Analyses No.406 The Gender Pay Gap in Informal Employment…
14
3. Data And Methodology
3.1. Data
We used cross-sectional data from 2007, which were collected within the project entitled
Poland's Shadow Economy: its size, characteristics, and social consequences financed by the
Polish Ministry of Labour and Social Affairs (MPiPS, 2008). The data covers members of
randomly sampled households. The size of the sample was approximately 8,000 households.
The data refer to the non-institutionalized population and covered all persons aged 15 years and
over. The survey contained an extensive set of demographic characteristics: age, education,
marital status and also information about labour market status, hours worked, income in the
previous month, in both the primary and additional jobs. Because of the sensitive nature of the
analysed issue, the survey did not include a direct question about an informal job. Instead, there
were a number of questions which identified certain characteristics of the informal employment.
On the basis of this query, we considered a person to be informally employed in the following
cases:
· a paid employee who works on the basis of an oral contract only without being declared
to the authorities,
· an employee who is declared to the authorities but his/her social contribution payment
and tax deductions are intentionally diminished, generally by joint agreement, for
example a full-time worker is declared to earn half of the sum actually paid,
· a paid employee who has a legal primary job but who works without registration and
without paying taxes and social security contributions in other jobs,
· a self-employed person, who works without being declared to the authorities,
· a self-employed person who declares only a part of his/her services for tax purposes.
Our definition is also consistent with an approach suggested by the ILO in 2003, which includes
workers outside informal enterprises into the informal sector. In which informal employment
refers to: “total number of informal jobs, whether carried out in formal sector enterprises, informal
sector enterprises, or households” (ILO 2002).
16. CASE Network Studies & Analyses No.406 The Gender Pay Gap in Informal Employment…
In this paper we have excluded from our analysis any illegal activity which is associated with
crime and criminal action. The analysis is restricted to respondents between 15 and 65 years of
age, who reported their income in the last month before interview, and number of hours worked
in the same period with an income higher than 1 Polish Zloty. After excluding those who have
not met the criteria we ended up with 5276 observations in the sample: 2545 observation for
women and 2731 for men regardless the employment status. Those who were considered as
informal employees/self-employed represent around 8.5% of the sample (452 observations).
G 1 2 L(X )dX (1),
where L(X) is a Lorenz curve
1 = = = =x x a
15
3.2. Methodology
There is no perfect measure of earnings inequality; each of the inequality measures satisfies
certain conditions, while disregarding other properties. There are many ways to measure the
dispersion of income distribution. In our analysis, first, we estimated the earnings distribution in
the formal and informal economies in Poland in 2007, using deciles ratios, Gini coefficients, and
other entropy indices (including Theil index).
The commonly used Gini coefficient is a measure of dispersion based on the Lorenz curve3:
= - 1
0
The coefficient varies between 0, which indicates complete equality, and 1, which indicates
complete inequality.
The inequality measures which are symmetric and additively decomposable are Generalized
Entropy inequality indices. We applied several generalized entropy indices in our analysis since,
as we shall show, this allows for more detailed decompositions:
( / ) 1 , 0,1
1
= =
)
1
( 1)
( ) (
1
¹
18. -
x a
a a N
I x
N
i
a
a i m (2)
) ( / )log( / ), 1
1
( ) (
Theil I x i
1
N
N
i
i m m (3)
3 See: Dorfman, Robert, 1979, A Formula for the Gini Coefficient, „The Review of Economics and Statistics” vol. 61,
p.146-149.
19. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
16
) log( / ), 0
1
= ( ) = (
x a
= =
0 N
1
MLD I x
N
i
i m (4),
where xi is a wage (earnings) of the i-th individual, N is a number of observations, μ is a mean of
earnings of N individuals.
The parameter ‘a’ specifies sensitivity to earnings differences in different parts of earnings
distribution: a0 is related to a greater sensitivity to higher earnings values, while a0
corresponds to a greater sensitivity to low earnings. Mean Log Deviation (MLD) is recognised as
relatively middle sensitivity. The value of indices varies between 0, which indicates total equality,
(everyone’s earnings are equal to a mean), and ln N (where only one individual has earnings).
The Theil index is equal to 0.5 for an inequality represented by a 74/26 distribution, and is 1 for
an inequality represented by an 82/18 distribution.
We could further decompose total inequality into a weighted sum of the inequalities within each
sub-group, plus inequality between groups:
I(x) = I within + I between (5)
This decomposition allows us to estimate earnings inequalities among men and compare them
with wage inequalities among women. We conducted the same decomposition twice, first using
information about informal employees, then applying the method to formal employees.
The next step is the measurement of the gender pay gap. As the raw gender pay gap could be a
result of the differences in productivity characteristics between the two genders, we applied a
method which allows for a more in-depth analysis. The main methodology used was the quantile
regression, as it gives a more detailed overview of wage characteristics depending on the wage
level. We first ran a regression on a pooled female and male sample, introducing a gender
specific variable. Then, we estimated quantile regression for each gender separately.
Quantile regression was introduced by Koenker and Bassett (1978). It is an extension of the
classical least squares estimation, in which instead of a mean estimation the estimation of the
quantile function is performed.
Let us assume that wage level depends linearly on a set of labour market characteristics:
q q = ' b + n i i y x (6)
The conditional quantile functions can be estimated by minimizing an asymmetrically weighted
of absolute errors (Koenker and Bassett 1978, Buchinsky 1998). If the conditional quantile of y,
qθ, is linear in x; q0 =xβ(θ), consequently, vector β(θ) is a solution to a:
20. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
q b q + - q -
b (q ) }
b q b q
min 1 (7)
i i y x y x
1 = - (8),
*
1 G = z a + e (9)
The Heckman model is based on the assumptions that both error terms (v, ε) are normally
distributed with the mean 0; (v, ε) is independent of X and Z. We used a probit model to estimate
equation (9), from this the Heckman correlation term (inverse of Mill’s ratio) is computed and
integrated into the wage equation (6).
17
( )
( )
( )
( )
i i
i y x i y x
i i i
-
: ³ :
where 0 θ1.
The estimator that minimizes (7) has good asymptotic properties: it is asymptotically normal
under general conditions (Cameron and Trivedi, 2009).
Sample selection – parametric approach
As only 56.5% of women aged 15-64 participate in the labour market in Poland, we have also
corrected for the selection into labour market.4 The reason for this is that we did not observe
wages of individuals who do not participate in the labour market. Individuals in employment tend
to have higher wages than those not in the labour force. As a result, the sample selection could
have biased our results if the selection was not random.5
In the analysis of female wage determinants, we applied the parametric procedure suggested by
Heckman (1979).
Let us assume that an individual is observed in employment only if a wage he is offered is above
his reservation wage:
i i G * W G '
where Wi is a wage, and G’1 is a reservation wage, so we could observe an indicator variable for
the employment G=1 if G*i0 and G=0 otherwise
1 1 1
Sample selection – semi-parametric approach
4 Data for 2007 based on Polish Labour Force Survey (Badanie Aktywności Ekonomicznej Ludności)
5 Because of the higher rate of male participation in labour market, we ignored the issue of sample selection in this
case.
21. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
As suggested by Buchinsky (1998), the parametric correction for the sample selection, which
assumes a specific distributional form of the disturbances, is not the best choice in the context of
quantile regression. Instead he recommends a non-parametric approach. Here, we decided to
use the semi-parametric estimator suggested by Klein and Spady (1993) to estimate the model
of labour market participation. Let us assume that Xi and μi are independent and the equation
has the form:
= ( a ) + m 0 Y g Z ' (10),
where g is an unknown function and the error term μ satisfies the condition:
E (m | Z ) = 0 , and Z is a set of explanatory variables of labour market participation.
Klein and Spady (1993) suggested estimating α using a maximum likelihood method. The log-likelihood
L = - Y - g X + Y g X (11)
i - i i i
- 18
function is given by:
(a ) (1 )ln (1 ˆ ( ' a )) ( ˆ ( ' a )), i i
i
i
whereaˆ maximizes L(α).
In the next step – using estimates from the above equation – a selectivity term is constructed.
We follow Buchinsky (1998) and calculate the selectivity term as:
( ) ( ) 1 = ˆ + ˆ - j
sj P g l m s g (12),
where:
λ - the usual inverse Mill’s ratio,
mˆ - the constant, and
sˆ - the slope coefficient from a probit regression of yi on the index g( xi, aˆ )
Decomposition
Then, we used decomposition, which permits us to explain gender differences in the earnings
gap. Since the 1970s, researchers have typically used the Blinder-Oaxaca decomposition to
divide the observed average gender gap into two components. The first is the portion
attributable to differences in endowments (or skills), and the difference in coefficients (or return
to skills) (Blinder 1973; Oaxaca 1973)
22. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
D ln W = b m (X m - X f )+ (b m - b f )X m + se (13),
where lnW represents the log earnings evaluated by an earnings equation separately for males
and females. The indices f and m represent female and male earnings respectively, X is the
average observed variables related to labor supply and labor demand characteristics , b is the
estimated returns on these characteristics and se is the selection effect.
We used a similar technique, but instead of examining the sources of the differences between
the means of two distributions, we explained the differences in quantiles between the male and
female log income distributions. The approach allows for the decomposition of differences in
different parts of the distribution in order to show that discrimination can depend on the quantile
at which it is estimated. It decomposes the observed differences in distributions into one part
that is explained by differences in characteristics (justified differentials), and another part that is
explained by differences in coefficients (usually interpreted as discrimination) and residuals.
We followed the counterfactual decomposition approach suggested by Machado and Mata
(2005) with a contribution suggested by Melly (2006). Machado and Mata first ran a quantile
regression separately for men and women, and then generated counterfactual densities: one if
women were given men’s characteristics but were paid as women, another one if women
retained their characteristics but were paid as men. Then, the decomposition of the difference
between quantiles of the unconditional distribution of males (m) and females (f) could be written
as:
ˆ (q ) ˆ (q ) [ˆ (q ) ˆ (q ) ] [ˆ (q ) ˆ (q ) ] m f m Cm Cm f q - q = q - q + q - q (14),
where qCm is the counterfactual distribution and qf and qm are unconditional quantile distributions
for women and men. The first parentheses give estimators of returns to characteristics and the
second for coefficients.
The Melly (2006) estimator is asymptotically equal to the one of Machado and Mata (2005).
Melly suggested that differences in distribution be decomposed by applying a semi-parametric
estimator of distribution functions. His approach is again a generalization of the Oaxaca/Blinder
decomposition.
19
23. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
20
4. Results
4.1. Descriptive statistics
Table 1 shows differences between formal and informal employment and between genders
within those groups. In general, women who work unofficially have on average the lowest
earnings, while the highest mean earnings are received by men from formal employment.
Earnings dispersion is greater in the informal market than in formal employment, and among
women those differences are larger than among men.
The differences are also visible with regard to other characteristics. In the informal sector, both
women and men are on average younger than their counterparts in formal employment. This
finding is in line with an explanation suggested by Jutting et al. (2008), who claims that the
informal market is a good place for younger people to gain experience and valuable skills.
Regardless of their form of labour market participation, women tend to have on average a higher
level of education than men do. Interestingly, almost the same proportion of women who work
informally have post secondary (29,4%) and vocational education (29,4%), while a huge
proportion of men in the informal sector have only a vocational level of education (44,8 %).
As far as family composition is concerned, our descriptive statistics are in line with previous
empirical analyses (Perry et al. 2007; Leonard 1998): women in informal sectors have on
average more children who are under 15 than their counterparts in the formal sector. However,
the proportion of single women in the informal sector is unexpectedly higher than in the formal
one: 28% of women in the informal sector are single, while in formal employment, 24% are
single.
Women in our sample experienced unemployment more often than men did, and more of them
had held an informal job in the past. Almost 60% of women who work in informal sector had
previous experience in unemployment (we include here all previous incidents of unemployment),
and 43% of them had worked in the informal market before. We suspect that these women are
more often forced into the informal market because of previous labour market records, and that
they might have low bargaining power, being potentially vulnerable to bad working conditions
and low earnings.
24. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
Among men, a similar pattern emerged, but its scope was more limited: respectively 46% of
informal male workers had been previously unemployed, and 38% of them had worked in the
informal sector before.
As expected, we also found a strong sectoral segregation. Unofficially working women are
underrepresented in the construction and transport sectors, while their presence is more
common in the trade, hospitality, health and education sectors. Those are the stereotypically
‘female’ sectors, in which women outnumber men in both the informal and formal sectors.
Std.
Dev. Mean
Ln(inc) 1.900 0.824 2.011 0.758 1.988 0.562 2.112 0.559
P90/P10 7.233 n.a 6.025 n.a 3.846 n.a 3.516 n.a
P90/P50 3.100 n.a 3.012 n.a 2.396 n.a 2.083 n.a
P50/P10 2.333 n.a 2.000 n.a 1.605 n.a 1.687 n.a
Age 35.098 11.242 36.992 11.477 37.820 10.669 38.090 10.802
Education (in years) 11.847 2.118 11.533 2.005 12.950 2.155 12.209 2.048
Tertiary education 0.078 0.270 0.069 0.253 0.248 0.432 0.142 0.350
Post secondary* 0.294 0.457 0.278 0.449 0.305 0.461 0.295 0.456
General secondary 0.201 0.402 0.048 0.215 0.180 0.384 0.084 0.277
Vocational education 0.294 0.457 0.444 0.498 0.215 0.411 0.411 0.492
Primary education 0.132 0.340 0.161 0.369 0.052 0.222 0.067 0.250
Single 0.289 0.455 0.298 0.458 0.240 0.427 0.245 0.430
Married 0.505 0.501 0.565 0.497 0.602 0.490 0.693 0.461
Widowed 0.137 0.345 0.081 0.273 0.136 0.343 0.040 0.197
No. children 15 years 2.302 1.367 2.010 1.129 2.054 0.976 2.216 1.134
Agriculture
0.142 0.350 0.141 0.349 0.014 0.118 0.033 0.179
Manufacturing 0.113 0.317 0.097 0.296 0.132 0.339 0.210 0.408
Construction 0.020 0.139 0.375 0.485 0.012 0.107 0.142 0.350
Trade 0.206 0.405 0.081 0.273 0.217 0.412 0.086 0.281
Hotel 0.098 0.298 0.016 0.126 0.040 0.196 0.015 0.121
Transport 0.015 0.121 0.057 0.232 0.029 0.167 0.104 0.305
Health and education 0.088 0.284 0.012 0.110 0.240 0.427 0.053 0.224
Other sectors 0.275 0.447 0.173 0.379 0.309 0.462 0.270 0.444
City 0.309 0.463 0.242 0.429 0.299 0.458 0.245 0.430
Town 0.392 0.489 0.391 0.489 0.452 0.498 0.440 0.496
Village 0.299 0.459 0.367 0.483 0.249 0.433 0.315 0.465
# observation 204 248 2334 2478
21
Table 1. Descriptive analysis
Variable Mean
Std.
Dev. Mean
Std.
Dev. Mean
Std.
Dev.
Graph 1 presents an estimated density of log wages for both genders in the informal and formal
sectors. In the informal sector, the density curve for men is steeper and higher than that for
women. Furthermore, the level of earnings with the highest density is greater for men than
women. In both sectors, we observed a higher concentration of women than men in the lowest
25. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
log of earnings. Surprisingly, in the formal market, we also observe wages below the minimal
wage. A possible explanation for this is the presence of ‘civil contracts for specific jobs’ which
are exempted from labour market regulations that apply to employees hired according to the
Labour Code.
Graph 1. Women and men’s log wage distribution (kernel density)
Formal employment Informal employment
22
0 .2 .4 .6 .8 1
Density
0 1 2 3 4 5
ln(wage/h)
MEN WOMEN
0 .2 .4 .6 .8 1
Density
0 1 2 3 4 5
ln(wage/h)
MEN WOMEN
Reference line is equal to ln(minimal wage/ h), which was calculated on the basis of minimal monthly payment for full
time employment for 2007, assuming 21 working days in a month and 8 hrs of work per day .
As reported in Graph 2., a gender earnings gap in informal employment is visible mainly at the
bottom of the distribution, as it converges in the group with middle earnings, therefore we do not
observe the distinctive glass ceiling effect reported in some other EU countries (e.g. for Sweden
by Albrecht et al., 2001; for Germany by Holst and Busch, 2009)6. When comparing the gender
earnings gap in the informal economy to the one observed in the regular labour market, we
notice that the gender gap is larger in the informal market at the two tails of the distribution (for
very low earnings and very high earnings). This lower gender gap in the formal market at the
bottom of the earnings distribution might be an effect of the minimum wage legislation. We may
also expect that in the informal economy those who agreed to relatively low earnings also have
lower bargaining power and females seem to be the more disadvantaged group.
6 Although in the top of wage distribution in informal market, we again observe the increase of the gender gap.
26. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
Graph 2. Gender earnings gap in formal and informal employment (5 percentile intervals)
23
-.1 0 .1 .2 .3
Gender gap
0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95
centile
INFORMAL FORMAL
*Gender gap is calculated as Ln(Mwage/h)- Ln(Wwage/h), where M stands for men, and W stands for women.
4.2. Earnings inequality
Table 2 presents the value of population and earnings share by gender in informal and formal
employment. An interesting feature is that women in our sample of informal workers represented
45 per cent of the population, while their share in overall earnings is around 41 per cent. A
similar trend is observed among registered workers. Women’s share in earnings is slightly lower
than their share in population. This again could indicate the existence of a certain gender
earnings inequality pattern (dominance of male earnings vs. female earnings) in both the formal
and informal labour markets.
Table 2. Population and earnings share by gender in informal and formal work
Population share Income share Log(mean)
Informal work
Women 0.449 0.414 2.235
Men 0.551 0.586 2.376
Formal work
Women 0.486 0.457 2.186
Men 0.514 0.543 2.301
27. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
As we expected, generalized entropy indices indicate a higher level of earnings inequality in the
informal economy than in the regulated jobs market. The Gini coefficient in the formal labour
market is 0.345, while in the informal labour market it reaches the level of 0.476.
While ‘gender inequality’ is a major contributor to overall earnings inequality in both analysed
labour markets, in the case of the informal market, its effect is more pronounced. Female
workers are more homogeneous with respect to their earnings dispersion than male workers in
the informal labour market. The value of entropy indices are lower for women than for men in all
analyzed cases, both in the case of indices sensitive for lower earnings I(-1), as well as in those
capturing inequality in higher earnings distributions I(2). The contrary results are reported for
dependent employees. According to results reported in Table 3, the male sub-group in the
formal labour market seems to experience a lower earnings inequality than the female sub-population.
It is also worth highlighting that inequality of earnings among unregistered women and men is
more pronounced at the bottom and top tails of the earnings distribution. As we can see, the
value of the I(-1) index, which is a more sensitive indicator of inequality at the bottom of
distribution, is higher than the MLD or Theil Indexes. Similarly I(2), which captures inequality
mostly in the top of the earnings distribution, is more than twice as large as the value of the Theil
Index.
Table 3. Generalized Entropy Indices and Gini coefficient
I (-1) MLD Theil Index I (2) Gini
Informal employment
All 0.535 0.395 0.483 0.987 0.476
Women 0.512 0.380 0.443 0.782 0.469
Men 0.546 0.404 0.507 1.098 0.479
Within group 0.532 0.393 0.480 0.982 n.a
Between group 0.002 0.002 0.002 0.002 n.a
Formal employment
All 0.210 0.200 0.256 0.496 0.345
Women 0.221 0.204 0.260 0.515 0.348
Men 0.193 0.193 0.249 0.476 0.338
Within group 0.208 0.198 0.254 0.495 n.a
Between group 0.002 0.002 0.002 0.002 n.a
The analysis above provides us with basic background information about earnings inequalities in
the informal and formal labour market. However, for a more in-depth analysis of the
determinants of earning gaps between men and women, we will apply more specific methods.
24
28. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
4.3. Quantile Regression
To use all possible information collected in our data source and to describe the dependence
between the form of employment (formal or informal) and the gender pay gap, we adopted the
following approach. First, standard Mincerian regression models for log wages were estimated
using the OLS method. Then, the results for quantile analyses (25th percentile, median and 75th
percentile) provided an overview of the relationship between the outcome and regressors at
several points of dependent variable distribution.
The explained variable was LOG INCOME from work per hour worked and the set of explanatory
variables consisted of age, age squared, family size and the following categorical variables:
- EDU, level of education, 1 for tertiary (college or university), 2 for secondary vocational
and post-secondary, 3 for general secondary, 4 for vocational primary, 5 for gymnasium,
primary and incomplete primary education,
- GEN, variable that equals 1 for women and 0 for men,
- MARR, equals 1 for a married individual and 0 otherwise
- FULL, 1 for full time job and 0 otherwise
- Dummy variables for sectors:
- AGR, value 1 in the case of work in agriculture,
- MANUF, value 1 if a person works in the manufacturing sector
- TRADE, value 1 if a person’s job is in trade
- CONSTR, if a person works in construction
- HOTEL, if a person works in the hotels and restaurants sector
- TRANS, if a person works in transport
- HEALTH, if a person works in the health or education sectors
25
CITY, value 1 if a person lives in a city
TOWN, value 1 if a person lives in a town
We did not have reliable information on tenure in the database so we assumed that individual
labour market experience can be approximated by age and years of education.
29. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
Pooled regression
In the first step, the regression on pooled data (men’s and women’s sample) was run using a
dummy gender variable (0=female, 1=male). We used this method to explain to what extent
differences between male and female characteristics explained gender disparity in log of hourly
earnings, controlling for such characteristics as: age, level of education, sectors and place of
living. In this analysis, we assumed that returns to labour market characteristics do not vary
among genders.
Table 4 presents quantile and OLS estimates of the gender dummy variable in two models.
In Model I, we included into the analysis such explanatory variables as: age, age squared, and
four levels of education. Then, in model II, we extended our analysis adding more variables: a
set of dummies for the sector of activity, a set of dummies for the place of residence, a
indicating full or part-time work and one for family size. The full set of results is presented in the
Appendix, Table A.1 and Table A.2.
Table 4. Summary of the result of pooled regression
Informal workers (n=452)
Formal workers (n=4812)
Quantile regression OLS Quantile regression OLS
q=0.25 q=0.5 q=0.75 Q=0.25 Q=0.5 q=0.75
Model I
Gender
coefficient 0.242*** 0.210*** 0.151** 0.191** 0.178*** 0.214*** 0.229*** 0.207***
Standard error 0.091 0.070 0.060 0.074 0.016 0.015 0.019 0.015
Model II
Gender
coefficient 0.214*** 0.222*** 0.114 0.180** 0.158*** 0.211*** 0.211*** 0.180**
Standard error 0.066 0.082 0.105 0.082 0.016 0.017 0.019 0.082
***statistically significant at 1% level, ** significant at 5% level
Model I (we regress ln wage on age, age2, gen, edu_1, edu_2, edu3, edu4_) basis category for education is edu_5=
primary education. Model II (Model I plus family size, full/part time work, place of living: city/ village and sector of
activity :a) sectors: agriculture, manufacturing, construction, trade, hotels, transport and health care, base category
other.)
We found that the gender variable is statistically significant in the majority of regressions,
although gender was insignificant in the sub-sample of unregistered workers in 75 percentile
regression in MODEL II. As expected, because of the higher dispersion of earnings in the
informal labour market, results from the OLS regression in comparison to the median regression
differ in the case of informal employment more than in the case of the formal labour market.
26
30. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
The gender coefficients vary across quantiles. In the informal labour market, the gender
coefficient has a much greater impact at the lower (0.25) than median conditional quantiles of
log earnings.
Consequently, the gender pay gap in the informal labour market decreases as we move up the
earnings distribution. This might suggest, as previously mentioned, that females who receive
very low hourly earnings, might suffer from larger discrimination in the absence of legal
regulations because they have lower bargaining power in the informal market than men. As
suggested by Fields (2005), they belong to a ‘lower tier,’ which consists of individuals who
cannot afford to be unemployed, and are rather ‘involuntary employees’ in the informal sector.
This effect of a higher gender gap at the bottom of the earnings distribution is often called the
‘sticky floor effect’.
A different pattern is observed in formal employment. After controlling for age and education, we
found that the gender pay gap increases as we follow the earnings distributions, and in fact the
glass ceiling effect could be reported. Newell and Reilly (2001) found a similar relationship using
Polish Labour Force statistics for 1996. They reported that the gender raw gap in the 25th
quantile was approximately 17.3%, while in the 75th quantile, the differences grow to 27.3%.
Taking into account results reported for the basic model (model I) we can interpret the gender
coefficient in the following way: being a man increases the conditional median of hourly earnings
by 1.52 PLN (0.21* 7.26) in informal employment.7 Being a male employee in the formal
employment increases the median of hourly earnings by 1.56 PLN (0.214* 7.30). If we compare
the results from a basic model (MODEL I) with those in a more extended model, we see that the
gender earnings gap in both markets diminishes while we are controlling for additional
characteristics: sectors of activity, character of work (full time, part time) and place of residence.
This pattern is common for both the informal and formal markets, although the impact of
additional explanatory variables is higher among informal employees.
In general, the gender pay gap at the top of the earning distribution (75th percentile) is greater in
the formal economy than in the informal labour market. A different pattern is observed at the
bottom of the distribution, where the female earnings disadvantage is more pronounced in the
informal market.
7 The Coefficients in Table 4 give marginal effect for lnwage. We can compute the marginal effect on wages in the
following way: Given Qq(lny/x) =x’q , we have Qq (y/x) = exp{ Qq (lny/x) } = exp(x’q). The marginal effect on y
27
( )
q qj
Q y x
q x
x
j
exp( 'b )b
/
=
¶
¶
N
- . (Cameron
i q {N exp(x' b )}b
1=
, than the average marginal effect is qj
i
1
Trivedi, 2009)
31. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
These findings give us an interesting insight into the gender pay gap in both analysed forms of
the labour market. It seems that a regulatory legal system works well in terms of eradicating
gender pay inequality among those with lower earnings. This might be an effect of the minimum
wage scheme. We can also suppose that in the case of basic, mainly manual, lower paid jobs,
the gender equality law could be more easily applied and an equal pay for an equal job is more
often the case. In contrast, it appears from the above analysis that female workers with higher
earnings are less discriminated in informal employment than in the formal labour market. One of
the characteristics of the informal labour market is its flexibility, and this factor might be useful in
explaining this phenomenon. Women who are at the top end of the earnings distribution seem to
have higher bargaining power; they can negotiate their remuneration more easily, and it is easier
for them to leave their jobs if their financial requirements are not met.
Regressions by gender
According to approach presented in the methodological part in the case of female wage
equation, we first looked at women’s labour market participation. The results of parametric and
semi parametric estimation are discussed below and presented in the Appendix (Table
A.1,Table A.2 and Table A.3).
Female labour market participation
Although the coefficients from estimations of female labour market participation vary depending
on the method used, their signs remain the same.
From the selection analysis it appears that a low level of education is an important factor for
labour market exclusion. The probability of female employment is low for women with only basic
or vocational basic education completed in comparison to those with at least post secondary
education (base category). These findings are in line with existing literature (Buchinsky 1998;
Fersterer and Winter-Ebmer, 2002; Bosio 2009).
Having controlled for other characteristics, married women had a lower propensity to work, and
again those findings are similar to other empirical studies. Surprisingly, in contrast to studies for
other countries (Fersterer and Winter-Ebmer, 2002; Connelly 1992) the presence of children
(younger than 15 years old) in a household increased the probability of labour market
participation for women. We expect that the system of after-school care centres, which are
located in the majority of schools, allows mothers to undertake professional activity, and that
expenses related to childbearing push them into the labour market. Unfortunately, the database
28
32. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
did not provide enough information to analyse the labour market participation of women with
younger children (less than 6 years old).
Table A2 in the appendix presents the results of a quantile regression with a correction for
women’s labour market selectivity. For comparison’s sake, an estimation which ignores selection
is also presented (last column). Women’s selectivity into employment only slightly influences our
results, although the direction of the bias depends on the quantile of the earnings distribution.
Age had a positive but diminishing effect on logs of earnings at any point of female earning
distribution, but had the strongest impact at the 50th percentile. An analysis of level of education
reveals an interesting pattern: having university education in comparison to vocational or lower
education increases a log earning in the informal market mostly for women in the middle of
earnings distribution. We expect that this impact is stronger at higher percentiles of earnings
distribution, and this is a fact in the case of female earnings in the formal market (Table A3).
Although in the informal market a level of education might not be the most important factor of
wage increase, which is why this relation is not so visible. An earning penalty for working
informally in agriculture is highest at the 50th percentile. While the highest positive impact of
sector variable on female earnings is observed in the case of health and education at the 75th
percentile. This is in line with our observation that most private tutorial lessons are given
informally, and it is an activity which generates rather significant income.
In the formal market, we observe slightly different patterns (Table A3 in the Annex). Age has the
strongest impact on female wages at the bottom of the earnings distribution, and is relatively
less important than in case of the previously analysed informal market. As mentioned above,
having a university degree increases the log of earning mainly for women with higher earnings
(75th percentile). Unlike in the previous analysis, employment in agriculture does not seem to
have a negative impact on the log of earnings, and returns from health and education are more
moderate than in the informal market. Interestingly, women working in the construction sector
receive a high premium in all levels of earnings distributions.
Coefficients not only differed between women working in the informal and formal markets, they
also differed from those observed for men. As the main part of our analysis is focused on
differences between genders, Table A4 presents closer estimates of quantile regression for
men. Due to the small sample size, there are only a few statistically significant coefficients in the
earnings regression for men in the informal market, and mainly at the top of the earnings
distribution (75th percentile). In the informal sector the highest returns for men are associated
with post secondary (or vocational post secondary) education. These results are different than
29
33. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
those reported for women in the informal sector for whom a university degree gives the highest
returns, and different from men’s situation in the formal market, which also rewards more higher
education. One might assume that post secondary education provides men with skills and
knowledge which is better valuated at informal market8. Contrary to the findings from the
informal sector for women, men working informally in health and education have a lower log of
earnings than if they work in a different sector.
There are also noticeable differences between males and females working in formal
employment. The majority of disparities are related to the sector of activity, while socio-demographic
characteristics have the same sign, and differ only in the size of impact. For
example men working in construction can expect lower logs of earnings than if they work in
another other sector, while for women, activity in this sector is rewarded more than their work in
a reference sector of activity.
As we mentioned before, age can be treated as an approximation of experience. The results of
our estimations suggest that returns to experience are higher in informal jobs (in all analysed
percentiles for women and in the 75th percentile for men) than in formal ones. Moreover there is
a different pattern in regards to education. A closer look at our results shows that secondary
vocational and post-secondary education of men in the informal market is more favourable than
a university degree from the point of view of wages, and this is a particular characteristic of
males in informal sector. Interestingly, working full time increases the log of earnings mainly at
the bottom of the earning distribution in informal sector, while being located in city has a positive
impact on wage distribution on both markets and for both genders.
In formal sector also working full-time in comparison to part-time is important, but a person (both
a woman and a man) in 25th quantile can expect higher wage when working full-time and in 75th
quantile one can expect lower wage.
Results of quantile regressions, separately for women and men working in formal and informal
sectors, presented in Graphs A1 to A4 in the Appendix allow for graphical comparison of
parameter estimates.
Counterfactual decomposition of quantile regression
Table 5 summarises the results of the decomposition of the gender earning gap in the formal
and informal sectors in selected percentiles. It reports a decomposition of the wage gap into the
8 This category includes professions common in the informal market: construction workers, mechanics, etc.
30
34. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
characteristics and coefficients effects. Results from all decompositions indicate that the gender
earnings gap would be even higher if women had men’s characteristics.
Table 5. Decomposition of the gender earnings gap
INFORMAL EMPLOYMENT
FORMAL EMPLOYMENT
Quantile 0.25 Effect St. Error Effect St. Error
Raw difference 0.181** 0.073 0.135*** 0.014
Characteristics -0.071 0.121 -0.014 0.012
Coefficients 0.252* 0.139 0.148*** 0.016
Quantile 0.5
Raw difference 0.133** 0.058 0.139*** 0.015
Characteristics -0.076 0.141 -0.048** 0.017
Coefficients 0.208 0.131 0.186*** 0.021
Quantile 0.75
Raw difference -0.003 0.117 0.109*** 0.025
Characteristics -0.173 0.133 -0.071** 0.027
Coefficients 0.170 0.154 0.180*** 0.031
OLS
Raw difference 0.106 0.077 0.124*** 0.016
Characteristics -0.105 0.140 -0.044*** 0.017
Coefficients 0.129 0.099 0.184*** 0.019
Interaction 0.082 0.153 -0.016 0.019
***statistically significant at 1% level, ** significant at 5% level, * significant at 10% level
The first conclusion from the presented numbers is that according to characteristics observed in
the data, women should have higher wages than men. That is in line with descriptive statistics
presented in Table 1 which show the relatively better education of women in Poland, no matter
which labour market (formal or informal) they work in. The majority of the gender log pay gap in
both types of work is due to differences in returns to labour market characteristics rather than to
differences in these characteristics.
Differences in coefficients are significant at least at 10% level mainly for the formal labour
market but the results for the informal labour market have been presented as well. The results
confirm our findings that in formal employment, a higher gender pay gap exists. Due to some
type of discrimination, it is in the higher end of the wage distribution. In informal employment,
there is a higher level of discrimination among lower paid workers.
In the informal sector, women have relatively better characteristics than men even in comparison
with the formal sector. Our models take into account education level but not type of education,
which may explain the result to some extent.
31
35. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
The negative sign at the 75th quantile may suggest that in informal work, highly paid women
have such favourable characteristics in comparison to men that even lower returns cannot
influence their lower wages. However, as this value is not significant – again due to the small
sample size – more thorough examination of this thesis could be an interesting research
question for future.
32
5. Conclusions
In this paper we used a set of cross-sectional data on both formal and informal work in Poland in
2007 to check if the gender pay gap observed in the formal market also occurs when a person
works without registration. Additionally, we examined the gender differences in earning
distribution for both types of employment. Various methodological approaches were used,
starting from measures of dispersion in earnings for women and men in both labour markets,
then adopting the quantile regression method using the Machado-Mata (2005) and Melly
decomposition (2006) developing the Blinder/Oaxaca (1973) approach. Additionally, the issue of
selectivity to employment for women was accounted for.
As we expected, an analyses of entropy indices indicated a higher level of earnings inequality in
the informal economy than in the regulated jobs market. This finding supports the argument of
Fields (2005) who suggested there is a substantial level of heterogeneity among voluntary and
involuntary workers engaged in the informal sector.
Furthermore our results confirm the existence of the gender pay gap in both informal
(unregistered) and formal employment in Poland. However its size and characteristics differ
depending on the level of earnings. The inequality of earnings between unregistered women and
men is more pronounced at the bottom of the earnings distribution. In the case of formal
employees, the inequality at the top of the distributions tends to be larger. Consequently, the
gender pay gap in the informal labour market decreases as we move up the earnings
distribution. Yet a different pattern is observed in formal employment. After controlling for age,
education and sector of activity, we found that the gender pay gap increases as we follow the
earnings distributions.
36. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
Findings from the Polish formal labour market confirm those of other European studies, in which
the existence of a strong glass ceiling effect is observed (Albrecht et al., 2004; Albrecht et al.,
2001). On the other hand, results from the informal labour market indicate that specific
characteristics of this type of employment, especially the lack of a minimum wage scheme, and
regulations of conditions and hours of work, could partially explain the unfavourable situation of
women in the ‘lower tier’.
We also found that returns to experience (approximated by the age variable) are higher in
informal jobs, but differences in these returns between men and women are significant only at
the bottom part of wage distribution. Age in formal employment has the strongest positive impact
on female wages at the bottom of earnings distribution, but it is relatively less important that in
the informal market.
Returns to education increase with wage distribution for both men and women but some of the
education levels become insignificant.
We also identified gender disparity in returns to sectors of activity. In the informal sector, women
gain if they are working in the health or education sectors, while there is an earning penalty for
working in agriculture sector. In the case of male informal workers, working in the construction
sector substantially increased their log of earning in all analyzed quantiles.
The results from a decomposition of the wage gap into the characteristics and coefficients effect
indicate that the gender earnings gap would be even higher if women had men’s characteristics.
This finding is contrary to those reported for some Western Economies and might indicate
specific characteristics of women in a post-socialist country. Women are generally better
educated than men but probably the type of education (not visible in our data) also has some
effect.
As the topic of a gender pay gap in the informal market is only meagrely covered in the
literature, there is a lot of potential for further studies. The use of longitudinal data might give an
interesting insight into the dynamics of the informal market and especially gender specific
aspects. An analysis of the macro condition of the labour market in the current economic
situation could add to knowledge of informal market mechanisms. As the main limitation of our
study is the size of our dataset (especially with regards to informal workers), the use of larger,
more developed dataset would be the most valuable extension of this study.
33
37. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
34
References
Adamchik VA, Bedi AS. Gender Pay Differentials During the Transition in Poland. Economics of
Transition 2003; 11; 4.
Albrecht J, Björklund A, Vroman S. Is There a Glass Ceiling in Sweden? Journal of Labor
Economics 2001; 21; 145-177.
Albrecht J, van Vuuren A, Vroman S. Decomposing the Gender Wage Gap in the Netherlands
with Sample Selection Adjustments. IZA Discussion Paper No. 1400 (November 2004).
Altonij JG, Blank RM 1999. Race and Gender in the Labor Market. In: Ashenfelter, OC, Card D
(Eds.). Handbook of Labour Economics., vol.3c.; Elsevier Science Publishers BV, 1999; p.
3143-3259.
Andresen KD, Ognedal T, Strom S.2005. The Shadow Economy in Norway 1980-2003: Some
Empirical Evidences from Voluntary Sample Surveys. In: Bajad Ch, Schneider F (Eds.). Size,
Causes and Consequences of the Underground Economy, Ashgate 2005, p. 139-156.
Blau FD, Kahn L. Gender Differences in Pay, Journal of Economic Perspectives 2000; 14;.75-
99.
Blau FD, Kahn L. Understanding International Differences in the Gender Pay Gap, Journal of
Labor Economics 2003; 21; 106-144.
Blinder A. Wage Discrimination: Reduced Form and Structural Estimates, The Journal of Human
Resources 1973; 7(4); 436-55.
Bosio, G. Temporary employment and wage gap with permanent jobs: evidence from quantile
regression, MPRA Paper No. 16055, University of Munich, Germany, 2009.
Bosworth D, Dawkins P, Stromback T. The Economics of the Labour Market, Longman 1996.
Brainerd E. Women in Transition: Changes in Gender Wage Differentials in Eastern Europe and
the Former Soviet Union, Industrial and Labor Relations Review 2000; 54; 1; 138-162.
38. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
Buchinsky M. Changes in U.S. Wage Structure 1963-87: An Application of Quantile Regression,
Econometrica 1994; 62; 405-458.
Buchinsky M. The Dynamics of Changes in the Female Wage Distribution in the USA: A
Quantile Regression Approach, Journal of Applied Econometrics 1998;13; 1-30.
Cahuc P, Zylberberg A. Labor Economics,, Cambridge, Mass. MIT Press, 2004.
Cameron A, Trivedi PK. Microeconometrices Using Stata, Stata Press, 2009.
Chong A, Gradstein M. Inequality and Informality, Journal of Public Economics 2007; 91; 159-
179.
Connelly R. The Effect of Child Care Costs on Married Women's Labor Force Participation, The
Review of Economics and Statistics 1992; 74; 1; 83-90.
Cunningham W 2001. Breadwinner Versus Caregiver: Labour Force Participation and Sectoral
Choice over the Mexican Business Cycle. In: Katz EG, Correia MC (Eds.). The Economics of
Gender in Mexico: World, Family, State and the Market, World Bank 2001, p. 85-132.
Dimova R, Gang I, Landon-Lane J. The Informal Sector During Crisis and Transition, UNU
WIDER, Research Paper No. 2005/18
Elvira MM, Graham ME. Not Just a Formality: Pay System Formalization and Sex-Related
Earnings Effects, Organization Science 2002; 13; 6; 601-617.
England, P, Farkas G, Kilboure BS, Dou T. Explaining occupational sex segregation and wages:
Findings from a model with fixed effects, American Sociological Review 1988; 53; 544-558.
European Foundation for the Improvement of Living and Working Conditions. Working
conditions and gender in an enlarged Europe, Luxembourg 2005.
Fersterer J, Winter-Ebmer R. Are Austrian returns to education falling over time? Labour
Economics 2003; 10; 73–89.
Fields G. A Guide to Multisector Labour Market Models. World Bank Social Protection
Discussion Paper Series No. 0505, The World Bank:Washington, DC; 2005.
35
39. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
Fiszbein A. Do Workers in Informal Sector Benefit from Cuts in the Minimum Wage? Policy
Research Working Paper Series No.826, The World Bank:Washington, DC; 1992.
Frey B, Weck H. Estimating the Shadow Economy: A ‘Naive’ Approach. Oxford Economic
Papers 1983; 35; 23-44.
Grajek M. Gender Pay Gap in Poland, Economics of Planning 2003;36; 23-44.
GUS. Praca nierejestrowana w Polsce w 2004 r. (Unregistered Employment in Poland in 2004).
GUS Warsaw, 2004.
Heckman J. Sample Selection Model as Specification Error, Econometrica 1979; 47; 153-161.
Henley A., Arabsheibani RG, Carneiro FG. On Defining and Measuring the Informal Sector. IZA
DP No. 2473; Nov 2006.
Holst E, Busch A. Glass Ceiling Effect and Earnings: The Gender Pay Gap in Managerial
Positions in Germany. SOEP papers 201, DIW Berlin, 2009.
ILO. ILO Compendium of Official Statistics on Employment in The Informal Sector. ILO STAT
Working Paper No. 1-2002, International Labour Organisation, Geneva, 2002.
Jarrel SB, Stanley DT. Declining Bias and Gender Wage Discrimination? A Meta-Regression
Analysis. The Journal of Human Resources 2004; 39; 3; 828-838.
Jonasson E. Regional Variation in Informal Employment: Skills, Norms, and Governance.
Working Paper No. 2009:10, Lund University, Department of Economics, 2009.
Jurajda S. Gender Wage Gap and Segregation In Enterprises and the Public Sector in Late
Transition Countries. Journal of Comparative Economics 2003; 31; 199-222.
Jütting J, Parlevliet J, Xenogiani T. Informal Employment Re-Loaded. OECD Development
Centre Working Paper No. 266-2008.
Karlinger L.The Underground Economy in the Late 1990s: Evading Taxes, or Evading
Competition? World Development 2009; 37; 10; 1600-1611.
Klein R., Spady R. An efficient semiparametric estimator of the binary response model,
Econometrica 1993; 61; 387-421.
36
40. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
Koenker R, Bassett G Regression quantiles, Econometrica 1978; 46; 33-50.
Leonard M. Invisible Work, Invisible Workers – The Informal Economy in Europe and the US.
Macmillan Press, 1998.
Machado J, Mata J. Counterfactual Decomposition of Changes in Wage Distributions Using
Quantile Regression. Journal of Applied Econometrics 2005; 20; 445-465.
Maloney WF. Informality Revisited, World Development 2004; 32; 7; 1159-1178.
Marcinkowska I, Ruzik A., Strawiński P., Walewski M. Badanie struktury i zmian rozkładu
wynagrodzeń w Polsce w latach 2000-2006. Ministerstwo Pracy i Polityki Społecznej, 2008.
Marcinkowska I. The Gender Wage Inequality among Young People in Poland, M. Sc. Thesis,
Warsaw University, 2005, unpublished.
Melly B. Estimation of Counterfactual Distributions Using Quantile Regression. Review of Labor
Economics 2006; 68; 543-572.
Milanovic, B. Income, Inequality, and Poverty during the Transition from Planned to Market
Economy. The World Bank:Washington, DC; 1998
MPiPS. Przyczyny pracy nierejestrowanej w Polsce [Determinants of the unregistered
employment in Poland]. Ministry of Labour and Social Policy, Warsaw, 2008.
Newell A, Reilly B. The Gender pay Gap in Transition from Communism, Some Emplirical
Evidence. Economic Systems 2001; 25; 287-304.
Newell A, Socha M. The Distribution of Wages in Poland. IZA Discussion Paper No. 1485ł 2005..
O’Neill J. The Gender Gap in Wages, circa 2000. The American Economic Review 2003; 93; 2;
309-314.
Oaxaca R. Male-Female Wage Differentials in Urban Labor Markets. International Economic
Review 1973; 14; 3; 693-709.
Paci P (Ed.). Gender in Transition. The World Bank: Washington, DC, 2002.
37
41. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
Perry GE, Maloney WF, Arias OS, Fajnzylber P, Mason AD, Saavedra-Chanduvi J. Informality:
Exit And Exclusion The World Bank: Washington, DC, 2007.
Pfau-Effinger B. Varieties of Undeclared Work in European Societies. British Journal of Industrial
Relations 2009; 47; 1; 79-99.
Renooy P. The informal Economy: Meaning , measuring and social significance. Geographical
Studies No. 115; 1990.
Renooy P, Ivarsson S, van der Wusten-Gritsai O, Meijer E. Undeclared Work in an Enlarged
Union an Analysis of Undeclared Work: An In-Depth Study of Specific Items (2004). Brussels,
European Commission 2004.
Schneider F, Enste D. Shadow Economies: Size, Causes, and Consequences. The Journal of
Economic Literature 2000; 38/1; 77-114.
Silveira S, Matosas A 2005. Gender And The Informal Economy in Latin America: New
Challenges and Possible Answers for Labour Training Policies. In: Maclean R, Wilson D, Singh
M (Eds.). Meeting Basic Learning Needs in the Informal Sector Integrating Education and
Training for Decent Work, Springer Netherlands, 2005; p. 91-118.
Terrell K, El Hamidi F. The Impact of Minimum Wages on Wage Inequality and Employment in
the Formal and Informal Sector in Costa Rica. William Davidson Working Paper Number 479;
2001.
Weichselbaumer D, Winter-Ebmer R. The effects of competition and equal treatment laws on
gender wage differentials. Economic Policy April 2007; CEPR, CES, MSH, 2007; p. 235–287.
Williams CC, Round J. Gender Variations in the Nature of Undeclared Work: Evidence from
Ukraine. Sociological Research Online 2008; 13, available at
http://www.socresonline.org.uk/13/4/7.html
38
42. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
39
Appendix
Table A1. Selection into labour market (female)
Probit model Semi-parametric model
Variable Coefficients Standard
error
Coefficients
Basic education -1.089*** 0.051 1.00 (default)
Vocational basic
-0.234
education -0.501*** 0.038
General secondary
education -0.221*** 0.046
-0.049
Married -0.042 0.034 -0.005
No of children 15 0.037** 0.017 0.015
Constant 0.410*** 0.033 -
No of observations 6720 No of observations: 6720
Log likelihood -4376.72 Bandwidth: 0.00734533
Correctly classified 62.02% Correctly classified:
62.94%
***statistically significant at 1% level, ** statistically significant at 5% level, * statistically significant at 10% level
44. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
41
Table A3. Estimations of quantile regressions for women in the formal sector
Semiparametric (n=2334) Parametric (n=2334)
Ignoring selection (n=2334)
q=0.25 q=0.5 q=0.75 q=0.25 q=0.5 q=0.75 q=0.25 q=0.5 q=0.75
Age 0.033*** 0.028*** 0.015 0.034*** 0.029*** 0.014 0.038*** 0.029*** 0.018
Age sq -0.035*** -0.026*** -0.009 -0.036*** -0.027*** -0.008 -0.041*** -0.027*** -0.013
Edu_3 0.220*** 0.257*** 0.308*** 0.192*** 0.244*** 0.263*** 0.216*** 0.248*** 0.296***
Edu_2 0.192*** 0.210*** 0.247*** 0.119*** 0.184*** 0.144*** 0.177*** 0.198*** 0.230***
Edu_1 0.516*** 0.612*** 0.790*** 0.437*** 0.583*** 0.686*** 0.504*** 0.595*** 0.775***
Married 0.023 0.029 0.039 -0.003 0.019 0.004 0.018 0.026 0.037
Family size -0.014** -0.024*** -0.019** -0.018*** -0.025*** -0.021** -0.017** -0.024*** -0.019*
Full time 0.124*** 0.053* -0.119*** 0.120*** 0.047* -0.119*** 0.104*** 0.050* -0.101**
City 0.134*** 0.189*** 0.144*** 0.114*** 0.185*** 0.117*** 0.143*** 0.188*** 0.144***
Town 0.028 0.058** 0.013 0.024 0.058** 0.016 0.024 0.055** 0.007
Agriculture 0.167** 0.241*** 0.347*** 0.161* 0.221*** 0.347*** 0.188** 0.201*** 0.328***
Manufacturing -0.006 0.017 -0.005 -0.007 0.027 -0.026 0.002 0.015 -0.001
Construction 0.303*** 0.319*** 0.291*** 0.300*** 0.330*** 0.291*** 0.293*** 0.334*** 0.291**
Trade -0.103*** -0.112*** -0.161*** -0.101*** -0.107*** -0.171*** -0.095*** -0.108*** -0.160***
Hotel 0.036 -0.011 -0.014 0.037 -0.009 -0.015 0.004 -0.010 -0.023
Transport 0.179*** 0.066 0.038 0.179*** 0.074 0.038 0.168*** 0.072 0.027441
Health/education 0.091*** 0.109*** 0.128*** 0.092*** 0.112*** 0.117*** 0.084*** 0.113*** 0.112***
Constant 0.535*** 0.892*** 1.474*** 0.803*** 0.979*** 1.856*** 0.578*** 0.939*** 1.522***
***statistically significant at 1% level, ** significant at 5% level, * significant at 10% level
Edu_1- tertiary education ; Edu_2 – Post secondary and secondary vocational education ; Edu_3 – General secondary education
45. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
42
Table A4. Estimations of quantile regressions for men
MEN INFORMAL (n=248) FORMAL (n=2478)
q=25 q=0.5 q=0.75 q=0.25 q=0.5 q=0.75
Age 0.010 0.037 0.060** 0.037*** 0.054*** 0.052***
Age sq -0.012 -0.048 -0.073** -0.044*** -0.006*** -0.062***
Edu_3 -0.011 0.094 0.210 0.129*** 0.129** 0.139***
Edu_2 0.209* 0.153 0.337*** 0.178*** 0.152*** 0.119***
Edu_1 0.252 0.293 0.199*** 0.431*** 0.435*** 0.451***
Married 0.142 0.186 -0.002 0.098*** 0.090*** 0.122***
Family size -0.017 -0.035 -0.005 -0.021*** -0.018** -0.023***
Full time 0.172 0.170 0.110 0.127*** -0.025 -0.149***
City 0.256* 0.192 0.280*** 0.100*** 0.155*** 0.207***
Town 0.196 0.037 0.010 0.007 0.038 0.061**
Agriculture -0.266 -0.351* -0.037 -0.206*** -0.246*** -0.125*
Manufacturing 0.245 0.200 0.107 -0.058* -0.079** -0.101***
Construction 0.123 0.175 0.186** -0.029 -0.073** -0.106***
Trade 0.206 0.096 0.186 -0.065 -0.160*** -0.177***
Hotel -0.041 0.075 -0.254 -0.180* -0.258*** -0.170*
Transport 0.341* 0.307 0.009 0.017 -0.031 0.031
Health/education 0.290 -0.072 -0.431*** -0.060 0.033 -0.017
_Constant 1.016 1.027 0.805* 0.845*** 0.927*** 1.323***
***statistically significant at 1% level, ** significant at 5% level, * significant at 10% level
Edu_1- tertiary education ; Edu_2 – Post secondary and secondary vocational education ; Edu_3 – General
secondary education
46. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
43
Graph A1. Results of quantile regression for women working in formal jobs, 25th, 50th and 75th percentiles
47. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
44
Graph A2. Results of quantile regression for women working in informal jobs, 25th, 50th and 75th percentiles
48. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
45
Graph A3. Results of quantile regression for men working in formal jobs, 25th, 50th and 75th percentiles
49. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
46
Graph A4. Results of quantile regression for men working in informal jobs, 25th, 50th and 75th percentiles
50. CASE Network Studies Analyses No.406 The Gender Pay Gap in Informal Employment…
47