When does transition increase the gender wage gap?

Abstract

In the context of underlying stability in female participation rates, the gender wagegap, measured by the log of monthly wages, more than doubled in Belarus from 1996 to 2006. In this respect, the country has experienced a variant of the transition which occurred in the former Soviet Union where relative female wages fell by more than female participation. We have used the Machado and Mata (2005) analysis of the gender gap distribution. This reveals that the effect of coefficients on observed characteristics in widening the gap was increasing over time, especially in the lower and middle deciles of the wage distribution. At the same time, the effect of the characteristics themselves in reducing the gap was shrinking. The decomposition of changes in the gap over time, based on Juhn et al. (1991), confirms that the contraction of women's relative wages has been caused both by a deterioration in the observed characteristics of female workers and by the associated remuneration. Changes in the residual wage distribution tend to slightly reduce the gap rather than, as is the case elsewhere, to increase it. The analysis carried out in line with Neuman and Oaxaca (2004) suggests that the increased gap was not caused by sample selection. Instead, two observed factors are found to be mainly responsible for the results: hours of work have increased for men more than for women and women have experienced segregation in low-wage industries.JEL classifications: J16, J22, J31, P20.

The gender gap in early career in Mongolia

“…This implies that surely the emergence of market forces has implied the loss of old privileges, but also the emergence of new opportunities, though such opportunities were not the same for every woman. According to Pastore and Verashchagina (2007), economic transition has generated different outcomes on female wages, with important cross-country differences. During transition, the conditional gender wage gap has remained constant in CEECs, due to greater labour market withdrawal of women, compared to FSU countries, where female wages decreased markedly, while their participation remained more stable.…”

Evaluating the Gender Wage Gap in Georgia, 2004 – 2011

“…Kecmanovic and Barrett (2011) find that the gender wage gap in Serbia declined during 2001 -2005 and in that case the fall appears to be uniform across the wage distribution. In contrast to the declines in Ukraine, Vietnam and Serbia, Pastore and Verashchagina (2011) demonstrate that the gender wage gap in Belarus more than doubled between 1996 and 2006 and 4 did so mostly at the bottom of the distribution. Chi and Li (2008) evaluate the case of China between 1987 and 2004 and find that the gender wage gap increased during this time, also primarily at the bottom of the distribution.…”

Gender Pay Gaps in the Former Soviet Union: A Review of the Evidence

“…Although women's labor force participation rates declined, they did so at slower rates than men's. This was in part because many women joined the workforce in response to spousal job loss while others moved into lower-level occupations (Pignatti 2016;Pastore and Verashchagina 2011). As a result, in the early transition period, the gender gaps in labor force participation rate contracted rather than widened.…”

“…This result indicates that in these countries the contractions in the gap at the mean have been driven by high-earning women. In some cases, the gap widened at the bottom end of the pay distribution, suggesting that the economic expansion benefitted low-earning men as well (Pastore and Verashchagina 2011;Khitarishvili 2016;Pignatti 2012). …”

“…Goldin (2014) argues that the predominance of occupations with rigid work-hour arrangements underlies the persistence of the unexplained portion of the gender wage gap in the United States. Focusing on the FSU region, Pastore and Verashchagina (2011) contend that the deterioration of the social care infrastructure over the last two-and-a-half decades has led many employed women in Belarus to move away from higherpaid jobs in the "material production" industries into lower paid but more flexible public-sector jobs in education and health; additionally, their working hours contracted relative to men. These developments were considerable enough to widen the gender pay gap in Belarus.…”