Women's Part-Time - Full-Time Wage Differentials in Europe: an Endogenous Switching Model

Colella, Fabrizio (2014): Women's Part-Time - Full-Time Wage Differentials in Europe: an Endogenous Switching Model.

Abstract

This paper analyzes the composition of the wage differentials among part-time and full-time working women in seven European countries: France, Germany, Italy, Netherlands, Spain, Sweden and United Kingdom. Using cross-sectional microdata from the eighth waves of the European Union Statistics on Income and Living Conditions project (EU-SILC), the study investigates the variances in part-time/full-time hourly wage gap and the role of different occupational profiles as a possible explanation. Applying an Oaxaca-Blinder Wage Decomposition, corrected for double sample selection to account for participation decisions and part-time/full-time choice, the adjusted wage gap is found to be negative in all countries except Sweden, where data show a significant part-time premium. Controlling for different job-related characteristics, the research points to a reduction of the gap in all countries; the unexplained portion remains, however, relevant in some countries. In order to shed light on the latter, existing studies are evaluated showing how cross-country dissimilarities can be due to cultural characteristics connected to workers' preferences and different institutional frameworks.

• Item Type: MPRA Paper
• Language: English
• Keywords: Part-Time Endogenous Switching Model Wage Differentials Women
• Subjects: J - Labor and Demographic Economics > J0 - General; J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs; J - Labor and Demographic Economics > J5 - Labor-Management Relations, Trade Unions, and Collective Bargaining; J - Labor and Demographic Economics > J7 - Labor Discrimination

References

Tindara Addabbo. Part Time Work in Italy, chapter in H P Blossfeld and C Hakim. Between Equalization and Marginalization: Women Working Part-Time in Europe and the United States of America, 1997.

James Albrecht, Anders Bjoorklund, and Susan Vroman. Unionization and the evolution of the wage distribution in sweden: 1968 to 2000. IZA Discussion Papers 4246, Institute for the Study of Labor (IZA), June 2009.

Piet Allaart and Lutz Bellmann. Reasons for part-time work: an empirical analysis for germany and the netherlands. International Journal of Manpower, 28(7):557{570, 2007.

Patricia Apps, Jan Kabatek, Ray Rees, and Arthur van Soest. Labor supply heterogeneity and demand for child care of mothers with young children. IZA Discussion Papers 7007, Institute for the Study of Labor (IZA), November 2012.

Patricia Frances Apps. The high taxation of working families. Australian Review of Public Affairs, 5:1{24, 2004.

Elena Bardasi and Janet Gornick. Working for less? women's part-time wage penalties across countries. Feminist Economics, 14(1):37{72, 2008.

Elena Bardasi and Janet C Gornick. Women and part-time employment: Workers" choices' and wage penalties in five industrialized countries. Institute for Social and Economic Research, University of Essex, 2000.

Yoram Barzel. The determination of daily hours and wages. The Quarterly Journal of Economics, 87(2):220{238, 1973.

R. Blank. Labor market dynamics and part-time work. Research in Labor Economics, 17: 57{93, 1998.

Alan S. Blinder. Wage discrimination: Reduced form and structural estimates. Journal of Human Resources, 8(4):436{455, 1973.

R. Blundell, T. MaCurdy, and C. Meghir. Labor supply models: unobserved heterogeneity, nonparticipation and dynamics. Open Access publications from University College London http://discovery.ucl.ac.u, University College London, December 2007. 47

Tito Boeri and Jan Van Ours. The economics of imperfect labor markets. Princeton University Press, 2013.

Alison Booth and Margi Wood. Back-to-front down-under? estimating the part-time/fulltime wage differential over the period 2001-2003. CEPR Discussion Papers 525, Centre for Economic Policy Research, Research School of Economics, Australian National University, May 2006.

Alison L. Booth and Jan C. van Ours. Hours of work and gender identity: Does part-time work make the family happier? Economica, 76(301):176{196, 02 2009.

AlisonL. Booth and JanC. van Ours. Job satisfaction and family happiness: The part-time work puzzle. Economic Journal, 118(526):F77{F99, 02 2008.

AlisonL. Booth and JanC. van Ours. Part-time jobs: what women want? Journal of Population Economics, 26(1):263{283, 2013. ISSN 0933-1433.

Kees Broekhof. Preschool education in the netherlands. Sardes Educational Service, SARDES, Utrecht, 2006.

Lars Calmfors. Work sharing, employment and wages. European Economic Review, 27 (3):293 { 309, 1985. ISSN 0014-2921.

Lars Calmfors and Michael Hoel. Work sharing, employment and shiftwork. Oxford Economic Papers, 41(4):758{73, 1989.

Simona Comi and Mara Grasseni. Are temporary workers discriminated against? evidence from europe. CHILD Working Papers 17/09, CHILD - Centre for Household, Income, Labour and Demographic economics - ITALY, Jul 2009.

Sara Connolly and Mary Gregory. The part-time pay penalty: earnings trajectories of british women. Oxford Economic Papers, 61:i76{i97, 2009.

Francois Contensou and Radu Vranceanu. Working time: Theory and policy implications. Edward Elgar Publishing, 2000.

Thomas Dohmen, Hartmut Lehmann, and Anzelika Zaiceva. The gender earnings gap inside a russian firm: First evidence from personnel data 1997 to 2002. IZA Discussion Papers 3428, Institute for the Study of Labor (IZA), April 2008.

John F. Ermisch and Robert E. Wright. Wage offers and full-time and part-time employment by british women. Journal of Human Resources, 28(1):111{133, 1993. 48

Gesping-Andersen. Social Foundations of Postindustrial Economies. Oxford University Press, Oxford, UK., 1990.

Eurofound. Part-time work in europe. Technical report, Sandor, Eszter, 2009.

Daniel Fernandez-Kranz and Nuria Rodriguez-Planas. The part-time pay penalty in asegmented labor market. Labour Economics, 18(5):591{606, 2011.

Raymond P. H. Fishe, R. P. Trost, and Philip M. Lurie. Labor force earnings and college choice of young women: An examination of selectivity bias and comparative advantage. Economics of Education Review, 1(2):169{191, April 1981.

Ira N. Gang, Catherine Y. Co, and Myeong-Su Yun. Switching models with self-selection: Self-employment in hungary. DepartmentalWorking Papers 199912, Rutgers University, Department of Economics, August 1999.

Pietro Garibaldi and Paolo Mauro. Anatomy of employment growth. Economic Policy, 17(34):67{114, 04 2002.

Janet Gornick. Gender equality in the labour market: Women's employment and earnings. Luxembourg Income Study, 1999.

Janet C Gornick and Marcia K Meyers. Welfare regimes in relation to paid work and care. Advances in Life Course Research, 8:45{67, 2003.

John C. Ham. Estimation of a labour supply model with censoring due to unemploymentand underemployment. Working Papers 521, Princeton University, Department of Economics, Industrial Relations Section., November 1980.

James J Heckman. Sample selection bias as a specifcation error. Econometrica, 47(1): 153{61, January 1979.

Axel Heitmueller. Public-private sector wage differentials in scotland: An endogenous switching model. IZA Discussion Papers 992, Institute for the Study of Labor (IZA), January 2004.

Anton Hemerijck and Jelle Visser. Policy learning in european welfare states. Universities of Leyden and Amsterdam, 2003.

Barry T. Hirsch. Why do part-time workers earn less? the role of worker and job skills. IZA Discussion Papers 1261, Institute for the Study of Labor (IZA), August 2004. 49

Yongjian Hu and Kea Tijdens. Choices for part-time jobs and the impacts on the wage differentials. a comparative study for great britain and the netherlands. IRISS Working Paper Series 2003-05, IRISS at CEPS/INSTEAD, March 2003.

Ethel B. Jones and James E. Long. Part-week work and human capital investment by married women. The Journal of Human Resources, 14(4):563{578, 1979.

Shireen Kanji. What keeps mothers in full-time employment? European Sociological Review, 27(4):509{525, 2011. Jerome E. King. Part-time workers earnings: Some comparisons. Technical report, Compensation and Working Conditions, Summer 2000.

F. Kramarz, P. Cahuc, B. Crepon, T. Schank, O. Skans, G. van Lomwel, and A. Zylberberg. Labour Market Effects of Work-Sharing arrangements in Europe - Edited by Tito Boeri, Michael C. Burda and Francks Kramarz, chapter in \Working Hours and work sharing in the EU and USA: are Europeans lazy or Americans crazy?". Oxford University Press, 2008.

Kerly Krillo and Jaan Masso. The part-time/full-time wage gap in central and eastern europe: The case of estonia. University of Tartu - Faculty of Economics and Business Administration Working Paper Series 65, Faculty of Economics and Business Administration, University of Tartu (Estonia), 2010.

Lung-Fei Lee. Identification and estimation in binary choice models with limited (censored) dependent variables. Econometrica, 47(4):977{96, July 1979.

G. S. Maddala and F.D. Nelson. Switching regression models with endogenous and exogenous switching. Proceedings of the American Statistical Association, pages 423{426., 1975. (Business and Economics Section).

Alan Manning and Barbara Petrongolo. The part-time pay penalty for women in britain. Economic Journal, 118(526):F28{F51, 02 2008.

Alan Manning and Helen Robinson. Something in the way she moves: a fresh look at an old gap. Oxford Economic Papers, 56(2):169{188, 2004.

Jose Mata and Jose A. F. Machado. Counterfactual decomposition of changes in wage distributions using quantile regression. Journal of Applied Econometrics, 20(4):445{465, 2005. 50

Eleonora Matteazzi, Ariane Pailhe, and Anne Solaz. Part-time wage penalties in europe: A matter of selection or segregation? Working Papers 250, ECINEQ, Society for the Study of Economic Inequality, March 2012.

Eleonora Matteazzi, Ariane Pailhe, and Anne Solaz. Does part-time employment widen the gender wage gap? evidence from twelve european countries. Working Papers 293, ECINEQ, Society for the Study of Economic Inequality, March 2013.

Blaise Melly. Decomposition of differences in distribution using quantile regression. Labour Economics, 12(4):577{590, August 2005.

Robert Moffitt. The estimation of a joint wage-hours labor supply model. Journal of Labor Economics, 2(4):550{66, October 1984.

Mark Montgomery. On the determinants of employer demand for part-time workers. The Review of Economics and Statistics, 70(1):pp. 112{117, 1988. ISSN 00346535.

Shoshana Neuman and Ronald L Oaxaca. Estimating labour market discrimination with selectivity corrected wage equations: Methodological considerations and an illustration from israel. CEPR Discussion Papers 1915, C.E.P.R. Discussion Papers, June 1998.

Ronald L. Oaxaca. Male-female wage differentials in urban labor markets. International Economic Review, 14(3):693{709, 1973. Michael J. Piore Peter B. Doeringer. Internal Labor Markets and Manpower Analysis.

Health Lexington Books, Lexington, 1971. M. Picchio. Wage differentials and temporary jobs in Italy. Open access publications from tilburg university, Tilburg University, 2006.

Christopher Pissarides, Pietro Garibaldi, Claudia Olivetti, Barbara Petrongolo, and EtienneWasmer. Women in the labor force: how well is Europe doing?, chapter in \Women at work: an economic perspective" edited by Tito Boeri, Daniela Del Boca and Christopher Pissarides, pages 9 { 120. Oxford University Press, Oxford, UK., 2005.

Cordelia W Reimers. Labor market discrimination against hispanic and black men. The Review of Economics and Statistics, 65(4):570{79, November 1983.

Joan R. Rodgers. Hourly wages of full-time and part-time employees in australia. Australian Journal of Labour Economics, 7.2:231{254, 2004. 51

Insan Tunali. A general structure for models of double-selection and an application to a joint migration/earnings process with remigration. Research in Labor Economics, 8 (Part B):235{282, 1986.

A. G. C. van Lomwel and J. C. van Ours. On the employment effects of part-time labor. De economist, 153 (4):451 { 460, 2005.

Ellen Verbakel. Partner's resources and adjusting working hours in the netherlands: Differences over time, between levels of human capital, and over the family cycle. Journal of Family Issues, 31:1324{1362, 2010.