300
Journal of Applied Economics
at the 1% level. Hence, on average, there is a substantial and significant pay gap
for both males and females. A Wilcoxon rank-sum test for the equality of the public
and private distribution is clearly rejected for both males and females.
Figure 1. Log hourly wages in the public and private sector by gender in 2000.
III. Econometric framework
The paramount aim of the paper is to estimate wages in the public and private
sector in order to study the causes of the unconditional earning differentials and
derive a structural switching equation that determines the sector choice. Hence,
in the following a switching regression model is adopted (Lee 1978) that estimates
separate wage equations for the public and private sectors. Let w1,i and w2,i be the
hourly wages in the public and private sector, respectively. Thus, the two log wage
equations to be estimated are:
ln w1,i = X1,i'β1 +ε1,i
(1)
More intriguing information
1. The name is absent2. The name is absent
3. The name is absent
4. The name is absent
5. A methodological approach in order to support decision-makers when defining Mobility and Transportation Politics
6. On Evolution of God-Seeking Mind
7. Gerontocracy in Motion? – European Cross-Country Evidence on the Labor Market Consequences of Population Ageing
8. Review of “The Hesitant Hand: Taming Self-Interest in the History of Economic Ideas”
9. The name is absent
10. The name is absent