Gender wage gap across the distribution: What is the role of within- and between-firm effects?

Abstract

This paper studies the role of within- and between-firm effects on the gender wage gap (GWG). Using linked employer–employee data for Turkey for 2006 and 2014, we show that the wage gap among comparable men and women is much wider within establishments than between establishments. Our distributional analysis shows a more pronounced gap among highly paid workers, consistent with the presence of a glass-ceiling effect. This effect, however, is more apparent within establishments than between establishments, and it is the former that drives the economy-wide glass ceiling that women face. We also find that between 2006 and 2014, the GWG in Turkey widened at all points in the wage distribution, and that this widening was more pronounced within establishments than between establishments.

The UK gender pay gap: Does firm size matter?

“…In terms of the GPG, our results contribute to the extensive international literature (for reviews, see Altonji and Blank 1999;Blau and Kahn 2017), which, despite recent attention on the importance of the firm, including in terms of workforce composition (see, for example, Bayard et al 2003;Mumford and Smith 2009;Theodoropoulos et al 2022), ownership (Magda and Sałach, 2021), and between and within-firm GPGs (see, for example, Card et al 2016;Hara 2018;Bruns 2019;Jewell et al 2020;Kaya 2021), has neglected explicit consideration of firm size. Yet, according to the Becker (1957) model of discrimination, large firms would be predicted to exhibit greater gender pay inequality if they possess product market power that makes them more able to discriminate (see Meng (2004) for supporting empirical evidence).…”

“…2016; Hara 2018; Bruns 2019; Jewell et al . 2020; Kaya 2021), has neglected explicit consideration of firm size. Yet, according to the Becker (1957) model of discrimination, large firms would be predicted to exhibit greater gender pay inequality if they possess product market power that makes them more able to discriminate (see Meng (2004) for supporting empirical evidence).…”

Organisational Gender Pay Gaps in the UK: What Happened Post-Transparency?

“…In the UK, as well as internationally, studies have used linked employee-employer data to provide new insights into the role of workplace characteristics, including employer practices (Chatterji et al, 2011), gender segregation (Mumford and Smith, 2009) and female managers (Theodoropoulos et al, 2019). Most recently, consistent with growing international attention (see, for example, Card et al, 2016;Kaya, 2021), Jewell et al (2020) explore within and between firm drivers of the UK GPG and confirm the importance of within-firm gender wage inequality, aligned to the employer focus of the transparency legislation. Existing UK evidence on organisational GPGs has, however, been based on data from the Workplace 1 See: https://www.gov.uk/government/news/prime-minister-my-one-nation-government-will-close-thegenderpay-gap.…”

Accounting for Firms in Ethnicity Wage Gaps Throughout the Earnings Distribution

“…3 For other recent applications of these decomposition methods that analyse the distributions of pay gaps, see Clark and Nolan (2021), who study ethnicity wage gaps in the UK over time using household survey data, and Kaya (2021), who studies the gender wage gap in Turkey using employer-employee linked data.…”