Measuring links between labor monopsony and the gender pay gap in Brazil

Abstract This paper focuses on gender differences in job mobility and earnings for workers in Brazil. Monopsony theory suggests a link between the wage elasticity of labor supply and wage penalties. Should one group of workers be less elastic in their supply choices, that group is predicted to earn...

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Main Author: Brandon Vick
Format: Article
Language:English
Published: Sciendo 2017-08-01
Series:IZA Journal of Development and Migration
Subjects:
Online Access:http://link.springer.com/article/10.1186/s40176-017-0099-x
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spelling doaj-9f91d8ce620f43ae9dd7c45089a1e10f2021-05-02T03:03:58ZengSciendoIZA Journal of Development and Migration2520-17862017-08-017112810.1186/s40176-017-0099-xMeasuring links between labor monopsony and the gender pay gap in BrazilBrandon Vick0Department of Economics, Indiana University of PennsylvaniaAbstract This paper focuses on gender differences in job mobility and earnings for workers in Brazil. Monopsony theory suggests a link between the wage elasticity of labor supply and wage penalties. Should one group of workers be less elastic in their supply choices, that group is predicted to earn less than others. To measure wage elasticity, I estimate a hazard model on voluntary job separations using the RAIS, a linked employer-employee dataset that captures formal-sector workers’ job durations over time. Four models are specified and point to significant gender differences. Across the models, male elasticity ranges from 1.638 to 2.175 while female elasticity ranges from 1.22 to 1.502. The female wage penalty predicted by these elasticity differences ranges from 11.4 to 20.5%, compared to an actual gender wage difference of 16.4%. Results of higher male elasticity are robust to the use of a more parsimonious specification, a discrete-time approach, the use of job spell data for a single year, and disaggregation by region. I extend the model through decomposition methods to help clarify the association between earnings, job separations, and elasticity.http://link.springer.com/article/10.1186/s40176-017-0099-xGender wage gapLabor supplyMonopsonySeparation elasticityBrazil
collection DOAJ
language English
format Article
sources DOAJ
author Brandon Vick
spellingShingle Brandon Vick
Measuring links between labor monopsony and the gender pay gap in Brazil
IZA Journal of Development and Migration
Gender wage gap
Labor supply
Monopsony
Separation elasticity
Brazil
author_facet Brandon Vick
author_sort Brandon Vick
title Measuring links between labor monopsony and the gender pay gap in Brazil
title_short Measuring links between labor monopsony and the gender pay gap in Brazil
title_full Measuring links between labor monopsony and the gender pay gap in Brazil
title_fullStr Measuring links between labor monopsony and the gender pay gap in Brazil
title_full_unstemmed Measuring links between labor monopsony and the gender pay gap in Brazil
title_sort measuring links between labor monopsony and the gender pay gap in brazil
publisher Sciendo
series IZA Journal of Development and Migration
issn 2520-1786
publishDate 2017-08-01
description Abstract This paper focuses on gender differences in job mobility and earnings for workers in Brazil. Monopsony theory suggests a link between the wage elasticity of labor supply and wage penalties. Should one group of workers be less elastic in their supply choices, that group is predicted to earn less than others. To measure wage elasticity, I estimate a hazard model on voluntary job separations using the RAIS, a linked employer-employee dataset that captures formal-sector workers’ job durations over time. Four models are specified and point to significant gender differences. Across the models, male elasticity ranges from 1.638 to 2.175 while female elasticity ranges from 1.22 to 1.502. The female wage penalty predicted by these elasticity differences ranges from 11.4 to 20.5%, compared to an actual gender wage difference of 16.4%. Results of higher male elasticity are robust to the use of a more parsimonious specification, a discrete-time approach, the use of job spell data for a single year, and disaggregation by region. I extend the model through decomposition methods to help clarify the association between earnings, job separations, and elasticity.
topic Gender wage gap
Labor supply
Monopsony
Separation elasticity
Brazil
url http://link.springer.com/article/10.1186/s40176-017-0099-x
work_keys_str_mv AT brandonvick measuringlinksbetweenlabormonopsonyandthegenderpaygapinbrazil
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