Does it pay to work in the public sector in Turkey?

Abstract

This article examines wage gap between the public and private sectors in Turkey. Relying on microdata from Turkey's Household Budget Survey (HBS) for the year 2009, we estimate separate earnings functions for public and private sectors by gender with appropriate correction for selectivity bias. The results suggest that while the observed pay advantage of public male employees can be explained entirely by differences in their observed characteristics, for female employees these differences only partly explain the observed public-private pay differential. Decomposition of male-female wage differentials by sector of work suggests that women are facing discrimination in both sectors.

Returns to Education in the Public and Private Sectors: Europe and Central Asia

“…These findings are in line with the literature (see, for example, Kanellopoulos, 1997). In Turkey, contrary to many findings in other countries, private returns to those working in the public sector are higher than those in the private sector, and private returns to those who followed the vocational track in secondary education are higher than those in the general academic track (Patrinos et al, 2021); however, that's an aberration even for Turkey (Akhmedjonov and Izgi, 2012). Overall, returns are highest at the tertiary level; in terms of private-public differences: the returns are higher in the private sector, at 9.5% vs. 6.8% in the public sector.…”

“…The public and private sectors may have different objectives; the public sector may want to pay more for less skilled workers for political reasons and might be reluctant not to pay too much for higher skilled workers so as not to make them leave the private sector (Katz and Krueger, 1983;Paparetrou, 2006). This work focuses on countries in Europe and Central Asia and looks at returns to education for workers in the public and private sectors of the economy and makes appropriate comparisons 2 . It also provides a test of the human capital versus screening views of investment in education, and suggests that the human capital, productivity enhancing approach is supported by the data.…”

Returns to Education in the Public and Private Sectors: Europe and Central Asia

“…These ndings are in line with the literature (see, for example, Kanellopoulos 1997). In Turkey, contrary to many ndings in other countries, private returns to those working in the public sector are higher than those in the private sector, and private returns to those who followed the vocational track in secondary education are higher than those in the general academic track (Patrinos et al 2021); however, that's an aberration even for Turkey (Akhmedjonov and Izgi 2012).…”

Returns to Education in the Public and Private Sectors: Europe and Central Asia

“…These findings are in line with the literature (see, for example, Kanellopoulos 1997). In Turkey, contrary to many findings in other countries, private returns to those working in the public sector are higher than those in the private sector, and private returns to those who followed the vocational track in secondary education are higher than those in the general academic track (Patrinos et al 2021); however, that's an aberration even for Turkey (Akhmedjonov and Izgi 2012).…”