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

Ezgi Kaya
Ezgi Kaya
   | Oct 18, 2021
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Published Online: Oct 18, 2021
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Accepted: Jun 15, 2021
DOI: https://doi.org/10.2478/izajodm-2021-0014
Keywords
© 2021 Ezgi Kaya, published by Sciendo
This work is licensed under the Creative Commons Attribution 4.0 International License.

Figure 1

Kernel density estimates of the wage distributions, by year and sex.Data source: Author's calculations based on the SES 2006 and 2014.Notes: The density functions are estimated using the Epanechnikov Kernel estimator. SES, Structure of Earnings Survey.
Kernel density estimates of the wage distributions, by year and sex.Data source: Author's calculations based on the SES 2006 and 2014.Notes: The density functions are estimated using the Epanechnikov Kernel estimator. SES, Structure of Earnings Survey.

Figure 2

Observed GWG, 2006 and 2014.Data source: Author's calculations based on the SES 2006 and 2014.Notes: The observed GWG is the difference between the log hourly wages of men and women. The graph is created using lowess smoothing, with a bandwidth of 0.25. GWG, gender wage gap; SES, Structure of Earnings Survey.
Observed GWG, 2006 and 2014.Data source: Author's calculations based on the SES 2006 and 2014.Notes: The observed GWG is the difference between the log hourly wages of men and women. The graph is created using lowess smoothing, with a bandwidth of 0.25. GWG, gender wage gap; SES, Structure of Earnings Survey.

Figure 3

Adjusted GWG at the mean and selected percentiles of the wage distribution.Data source: Author's calculations based on the SES 2006 and 2014.Notes: (i) Sample is restricted to individuals of working age (between 15 years old and 64 years old), excluding paid stagers and apprentices, who are working in establishments that employ both males and females. The data are not weighted. (ii) Each coefficient estimate and associated 95% CI come from a separate regression. Specifications (2a)–(2d) are as set out in the text. Point estimates are provided in Table 3. CI, confidence interval; GWG, gender wage gap; SES, Structure of Earnings Survey.
Adjusted GWG at the mean and selected percentiles of the wage distribution.Data source: Author's calculations based on the SES 2006 and 2014.Notes: (i) Sample is restricted to individuals of working age (between 15 years old and 64 years old), excluding paid stagers and apprentices, who are working in establishments that employ both males and females. The data are not weighted. (ii) Each coefficient estimate and associated 95% CI come from a separate regression. Specifications (2a)–(2d) are as set out in the text. Point estimates are provided in Table 3. CI, confidence interval; GWG, gender wage gap; SES, Structure of Earnings Survey.

Figure 4

Decomposition of the GWG at selected percentiles of the wage distribution, 2006.Data source: Author's calculations based on the SES 2006.Notes: (i) Specifications (2a)–(2d) are as set out in the text. (ii) RIF-BO method is used to decompose the GWG using male coefficients as the baseline. (iii) “Explained gap” is that part of the raw GWG that is due to gender differences in productivity-related characteristics included in the specification. “Unexplained gap” is that part of the raw GWG that remains unexplained after controlling for the productivity-related characteristics. BO, Blinder-Oaxaca; GWG, gender wage gap; RIF, Recentered Influence Function; RIF-BO, BO decomposition that relies on the RIF regression; SES, Structure of Earnings Survey.
Decomposition of the GWG at selected percentiles of the wage distribution, 2006.Data source: Author's calculations based on the SES 2006.Notes: (i) Specifications (2a)–(2d) are as set out in the text. (ii) RIF-BO method is used to decompose the GWG using male coefficients as the baseline. (iii) “Explained gap” is that part of the raw GWG that is due to gender differences in productivity-related characteristics included in the specification. “Unexplained gap” is that part of the raw GWG that remains unexplained after controlling for the productivity-related characteristics. BO, Blinder-Oaxaca; GWG, gender wage gap; RIF, Recentered Influence Function; RIF-BO, BO decomposition that relies on the RIF regression; SES, Structure of Earnings Survey.

Figure 5

Decomposition of the GWG at selected percentiles of the wage distribution, 2014.Data source: Author's calculations based on the SES 2014.Notes: (i) Specifications (2a)–(2d) are as set out in the text. (ii) RIF-BO method is used to decompose the GWG using male coefficients as the baseline. (iii) “Explained gap” is that part of the raw GWG that is due to gender differences in productivity-related characteristics included in the specification. “Unexplained gap” is that part of the raw GWG that remains unexplained after controlling for the productivity-related characteristics. BO, Blinder-Oaxaca; GWG, gender wage gap; RIF, Recentered Influence Function; RIF-BO, BO decomposition that relies on the RIF regression; SES, Structure of Earnings Survey.
Decomposition of the GWG at selected percentiles of the wage distribution, 2014.Data source: Author's calculations based on the SES 2014.Notes: (i) Specifications (2a)–(2d) are as set out in the text. (ii) RIF-BO method is used to decompose the GWG using male coefficients as the baseline. (iii) “Explained gap” is that part of the raw GWG that is due to gender differences in productivity-related characteristics included in the specification. “Unexplained gap” is that part of the raw GWG that remains unexplained after controlling for the productivity-related characteristics. BO, Blinder-Oaxaca; GWG, gender wage gap; RIF, Recentered Influence Function; RIF-BO, BO decomposition that relies on the RIF regression; SES, Structure of Earnings Survey.

Figure 6

Unexplained gap at selected percentiles of the wage distribution, 2006 and 2014.Data source: Author's calculations based on the SES 2006 and 2014.Notes: (i) Specifications (2a)–(2d) are as set out in the text. (ii) Each point estimate and associated 95% CI are estimated using the RIF-BO method to decompose the GWG using male coefficients as the baseline. (iii) “Unexplained gap” is that part of the observed GWG that remains unexplained after controlling for the productivity-related characteristics included in each specification. BO, Blinder-Oaxaca; CI, confidence interval; GWG, gender wage gap; RIF, Recentered Influence Function; RIF-BO, BO decomposition that relies on the RIF regression; SES, Structure of Earnings Survey.
Unexplained gap at selected percentiles of the wage distribution, 2006 and 2014.Data source: Author's calculations based on the SES 2006 and 2014.Notes: (i) Specifications (2a)–(2d) are as set out in the text. (ii) Each point estimate and associated 95% CI are estimated using the RIF-BO method to decompose the GWG using male coefficients as the baseline. (iii) “Unexplained gap” is that part of the observed GWG that remains unexplained after controlling for the productivity-related characteristics included in each specification. BO, Blinder-Oaxaca; CI, confidence interval; GWG, gender wage gap; RIF, Recentered Influence Function; RIF-BO, BO decomposition that relies on the RIF regression; SES, Structure of Earnings Survey.

Figure B1

Sensitivity analysis, MM decomposition of the GWG across the distribution, 2006.Data source: Author's calculations based on the SES 2006.Notes: (i) Specifications (2a)–(2d) are as set out in the text. (ii) MM decomposition method is used to decompose the GWG using male coefficients as the baseline. (iii) “Estimated GWG” is the estimated raw GWG using the conditional quantile regression model and integrating over the set of covariates. “Explained gap” is that part of the observed gap that is due to gender differences in productivity-related characteristics included in the specification. “Unexplained gap” is that part of the observed gap that remains unexplained after controlling for the productivity-related characteristics. GWG, gender wage gap; MM, Machado-Mata; SES, Structure of Earnings Survey.
Sensitivity analysis, MM decomposition of the GWG across the distribution, 2006.Data source: Author's calculations based on the SES 2006.Notes: (i) Specifications (2a)–(2d) are as set out in the text. (ii) MM decomposition method is used to decompose the GWG using male coefficients as the baseline. (iii) “Estimated GWG” is the estimated raw GWG using the conditional quantile regression model and integrating over the set of covariates. “Explained gap” is that part of the observed gap that is due to gender differences in productivity-related characteristics included in the specification. “Unexplained gap” is that part of the observed gap that remains unexplained after controlling for the productivity-related characteristics. GWG, gender wage gap; MM, Machado-Mata; SES, Structure of Earnings Survey.

Figure B2

Sensitivity analysis, MM decomposition of the GWG across the distribution, 2014.Data source: Author's calculations based on the SES 2014.Notes: (i) Specifications (2a)–(2d) are as set out in the text. (ii) MM decomposition method is used to decompose the GWG using male coefficients as the baseline. (iii) “Estimated GWG” is the estimated raw GWG using the conditional quantile regression model and integrating over the set of covariates. “Explained gap” is that part of the observed gap that is due to gender differences in productivity-related characteristics included in the specification. “Unexplained gap” is that part of the observed gap that remains unexplained after controlling for the productivity-related characteristics. GWG, gender wage gap; MM, Machado-Mata; SES, Structure of Earnings Survey.
Sensitivity analysis, MM decomposition of the GWG across the distribution, 2014.Data source: Author's calculations based on the SES 2014.Notes: (i) Specifications (2a)–(2d) are as set out in the text. (ii) MM decomposition method is used to decompose the GWG using male coefficients as the baseline. (iii) “Estimated GWG” is the estimated raw GWG using the conditional quantile regression model and integrating over the set of covariates. “Explained gap” is that part of the observed gap that is due to gender differences in productivity-related characteristics included in the specification. “Unexplained gap” is that part of the observed gap that remains unexplained after controlling for the productivity-related characteristics. GWG, gender wage gap; MM, Machado-Mata; SES, Structure of Earnings Survey.

Raw and adjusted GWG at selected percentiles of the wage distribution

Year and specification RIF-OLS regressions (percentile of the wage distribution) OLS
5th 10th 25th 50th 75th 90th 95th Mean
2006
(1) Raw GWG 0.001 (0.001) −0.000 (0.001) −0.000 (0.001) 0.020*** (0.005) 0.056*** (0.016) 0.029*** (0.016) −0.009 (0.021) 0.024*** (0.007)
(2) Adjusted GWG
a. Personal characteristics 0.001 (0.001) 0.001 (0.001) 0.001 (0.001) 0.042*** (0.004) 0.107*** (0.012) 0.077*** (0.012) 0.071*** (0.017) 0.051*** (0.005)
b. Personal and work-related characteristics 0.001 (0.001) 0.001 (0.001) 0.001 (0.001) 0.037*** (0.004) 0.100*** (0.010) 0.072*** (0.012) 0.077*** (0.017) 0.048*** (0.004)
c. Personal, work-related, observed firm and observed establishment characteristics 0.000 (0.001) 0.001 (0.001) 0.001 (0.001) 0.040*** (0.004) 0.089*** (0.009) 0.070*** (0.011) 0.102*** (0.016) 0.048*** (0.004)
d. Personal and work-related characteristics and establishment fixed effects 0.001* (0.000) 0.001*** (0.000) 0.001*** (0.000) 0.026*** (0.002) 0.082*** (0.006) 0.111*** (0.008) 0.179*** (0.012) 0.051*** (0.002)
2014
(1) Raw GWG 0.132*** (0.031) 0.011*** (0.002) 0.011*** (0.002) 0.138*** (0.010) 0.097*** (0.015) 0.046* (0.020) 0.084*** (0.021) 0.084*** (0.009)
(2) Adjusted GWG
a. Personal characteristics 0.114*** (0.030) 0.011*** (0.002) 0.011*** (0.002) 0.175*** (0.008) 0.172*** (0.011) 0.143*** (0.016) 0.160*** (0.019) 0.122*** (0.007)
b. Personal and work-related characteristics 0.075* (0.029) 0.009*** (0.002) 0.009*** (0.002) 0.155*** (0.007) 0.154*** (0.010) 0.138*** (0.016) 0.162*** (0.019) 0.108*** (0.006)
c. Personal, work-related, observed firm and observed establishment characteristics 0.114*** (0.030) 0.011*** (0.002) 0.012*** (0.002) 0.146*** (0.007) 0.143*** (0.010) 0.124*** (0.015) 0.158*** (0.018) 0.106*** (0.006)
d. Personal and work-related characteristics and establishment fixed effects 0.038 (0.023) 0.006*** (0.001) 0.006*** (0.001) 0.113*** (0.004) 0.132*** (0.007) 0.170*** (0.011) 0.222*** (0.015) 0.095*** (0.004)

Number of employees to be sampled in establishments (SES second stage of sampling) by size band of the establishment

Establishment size band Number of employees to be sampled
1–19 All
20–49 20
50–99 25
100–299 35
250–499 40
500–999 50
1,000–2,499 75
2,500–4,999 125
5,000 and over 150

List of selected gender equality policies, Turkey 2000–2018

Year Policy Description
2001 Amendment to the Constitution (Article 41) Added “based on the equality between spouses” to the previous version of the article, which stated that “Family is the foundation of the Turkish society”.
2002 New Civil Code (Law no: 4721) Increased the legal marriage age to 18 for men (from 17) and women (from 15); established the equality of men and women in the family, including abolishment of the term “head of household” and of needing the permission of spouses to work; introduced the legal basis for the sharing of marital assets in case of divorce; granted the same heredity rights to children born out of wedlock as to those of legitimate birth.
2003 New Labor Law (Law no: 4857) Set the legal basis for equal pay for equal work; reinforced the equal treatment principle for women and men; decreased the restrictions on temporary employment; provided a legal basis for atypical employment; lifted the ban on employment of women in night shifts of manufacturing establishments; extended paid maternity leave from 12 weeks to 16 weeks (8 weeks before and 8 weeks after childbirth); introduced breastfeeding leave to a total of one and a half hours for mothers of children below the age of one; obliged companies employing 100–150 female workers to provide comprehensive nursery rooms for children under the age of one and companies employing >150 female workers to provide comprehensive childcare centers and pre-school facilities for children under the age of six.
2003 Family Court Law (Law no: 4787) Established Family Courts in districts with >100,000 population to enforce the Civil Code and ensure gender equality.
2004 Amendments to the Constitution (Articles 10 and 90) Amendments to Article 10 reinforced equal rights of women and men and emphasized the responsibility of the State to ensure equality. Amendments to Article 90 ensured the supremacy of international laws (including the Convention on the Elimination of All Forms of Discrimination against Women in 1985 and the European Social Charter in 1996) in the case of a conflict between Turkish law and international treaties with regards to human rights.
2005 New Penal Code (Law no: 5237) Defined sexual harassment in work; reinforced prohibition of gender-based discrimination.
2006 Social Insurance and General Health Insurance Act (Law no: 5510) Merged different security systems into one structure; adopted harmonized legislation for maternity and breastfeeding leaves and for the pension plans regulating the working conditions for women.
2008 Employment Package (Law no: 5763) Introduced a direct employment subsidy program (with a limit that corresponds to the minimum wage level) with a one-year participation period (extended to June 30, 2010, with Law 5838) by reducing the employers’ contribution to social security payment of new hires for 5 years, covering 100% of social security payments of new employees for the first year and reducing its participation by 20% each year for the following 4 years. Targeted young men (ages between 18 and 29) and women >18 who were not employed as a tax-registered workers in the preceding 6 months.
2010 Amendment to the Constitution (Article 10) Added “Measures taken for this purpose shall not be interpreted as contrary to the principle” to Article 10.
2011 Amendments to the Labor Law (Law No. 6111) Enforced the rules of maternity leave for women (mandatory for 16 weeks and fully paid by the social security system); introduced the right to use paid leaves for breastfeeding; ruled out terminating job contracts on grounds of pregnancy; brought new regulations for part-time work; incorporated domestic help workers into the social security system; extended maternity leave to 12 months for civil servants and 6 months for others on an unpaid basis; granted 10 days’ voluntary paid paternity leave to civil servants whose wives give birth. Extended the period (for the period between March 2011 and December 2015) and coverage (both men and women of all ages and relaxing the subsidy limit covering the total social security payment amount regardless of the wage level) of the 2008 employment subsidy program.
2016 Amendments to the Labor Law (Law no: 6663) Introduced unpaid maternity leave to mothers as half of their weekly working hours for 60 days for the first birth, 120 days for the second birth, and 160 days for following births; introduced the right to request part time work for the period between when maternity leave ends until the beginning of the month after the child's compulsory education begins for both parents whose spouse is also working; extended the coverage of maternity leave and the right to request part-time work to couples or individuals adopting a child under 3 years’ old.

Decomposition of the GWG at the mean

Specification
(2a) (2b) (2c) (2d)
2006
Raw GWG 0.024*** (0.006) 0.024*** (0.006) 0.024*** (0.006) 0.024*** (0.006)
Explained gap −0.023*** (0.004) −0.025*** (0.004) −0.024*** (0.005) −0.016*** (0.001)
[−97.2%] [−104.8%] [−103.1%] [−65.9%]
Unexplained gap 0.047*** (0.005) 0.049*** (0.004) 0.048*** (0.004) 0.039*** (0.001)
[197.2%] [204.8%] [203.1%] [165.9%]
2014
Raw GWG 0.084*** (0.008) 0.084*** (0.008) 0.084*** (0.008) 0.084*** (0.008)
Explained gap −0.035*** (0.005) −0.024*** (0.005) −0.019*** (0.006) −0.008*** (0.002)
[−41.9%] [−29.1%] [−22.8%] [−9.0%]
Unexplained gap 0.119*** (0.007) 0.108*** (0.006) 0.103*** (0.006) 0.092*** (0.003)
[141.9%] [129.1%] [122.8%] [109.0%]

Sample means within establishments

2006 2014
All Males Females All Males Females
Personal characteristics
Male 0.71 – – 0.67 – –
Educational attainment
  Primary school and below 0.26 0.28 0.17 0.16 0.16 0.15
  Primary education and secondary school 0.15 0.16 0.10 0.14 0.15 0.10
  High school 0.27 0.26 0.31 0.32 0.32 0.33
  Vocational high school 0.09 0.09 0.10 0.07 0.08 0.06
  Higher education 0.23 0.22 0.32 0.31 0.29 0.37
Potential labor market experience (years) 16.68 17.66 14.25 17.09 17.74 15.76
Work-related characteristics
Tenure (years) 3.20 3.29 2.93 2.86 2.97 2.61
Full-time 0.99 0.99 0.99 0.98 0.98 0.98
Permanent contract 0.97 0.97 0.97 0.94 0.94 0.95
Overtime work 0.11 0.11 0.8 0.15 0.16 0.12
Occupation distribution
Legislators, senior officials, and managers 0.07 0.08 0.06 0.06 0.08 0.05
Professionals 0.08 0.07 0.12 0.10 0.10 0.13
Technicians and associate professionals 0.18 0.17 0.20 0.09 0.09 0.08
Clerks 0.14 0.01 0.28 0.17 0.13 0.28
Service, shop and market sales’ workers 0.13 0.14 0.11 0.26 0.25 0.26
Skilled agricultural and fishery workers 0.00 0.00 0.00 0.00 0.00 0.00
Craft and related trade workers 0.16 0.17 0.08 0.11 0.12 0.03
Plant and machine operators and assemblers 0.11 0.13 0.04 0.09 0.11 0.04
Elementary occupations 0.13 0.13 0.12 0.12 0.11 0.13
Average number of employees per establishment 19 14 5 17 12 5

Components of the BO decomposition of the mean GWG, 2006

Specification
(2a) (2b) (2c) (2d)
Raw GWG 0.024*** (0.006) 0.024*** (0.006) 0.024*** (0.006) 0.024*** (0.006)
Explained gap −0.023*** (0.003) −0.025*** (0.004) −0.024*** (0.005) −0.016*** (0.001)
[−97.2] [−104.8%] [−103.1%] [−65.9%]
Unexplained gap 0.047*** (0.005) 0.049*** (0.004) 0.048*** (0.004) 0.039*** (0.001)
Explained [197.2] [204.8%] [203.1%] [165.9%]
Personal characteristics
Education −0.138*** (0.004) −0.119*** (0.003) −0.106*** (0.003) −0.067*** (0.001)
[−580.0%] [−503.1%] [−447.8%] [−282.4%]
Potential labour market experience 0.115*** (0.003) 0.054*** (0.002) 0.054*** (0.002) 0.046*** (0.001)
[482.8%] [225.8%] [227.7%] [192.1%]
Work-related characteristics
Tenure 0.038*** (0.002) 0.024*** (0.002) 0.016*** (0.000)
[160.6%] [101.1%] [68.7%]
Permanent contract 0.000 (0.000) −0.000 (0.000) −0.000*** (0.000)
[0.6%] [−0.8%] [−0.8%]
Full-time −0.005*** (0.001) −0.006*** (0.001) −0.006*** (0.000)
[−20.3%] [−23.8%] [−24.5%]
Overtime work 0.007*** (0.001) 0.003*** (0.000) −0.005*** (0.000)
[31.4%] [12.7%] [−19.1%]
Observed firm and establishment characteristics
Firm size 0.001 (0.001)
[3.9%]
Collective agreement coverage 0.012*** (0.001)
[49.3%]
Industry of the establishment −0.006* (0.002)
Unexplained [−25.5%]
Characteristics 0.006 (0.011) −0.010 (0.051) −0.031 (0.051) 0.056** (0.022)
[26.3%] [−42.8%] [−132.1%] [237.8%]
Constant 0.041*** (0.010) 0.059 (0.051) 0.080 (0.052) −0.017 (0.022)
[170.9%] [247.6%] [335.2%] [−71.9%]

Raw and adjusted GWG at the mean

Specification Raw GWG Adjusted GWG
(1) (2a) (2b) (2c) (2d)
2006 0.024*** (0.007) 0.051*** (0.005) 0.048*** (0.004) 0.048*** (0.004) 0.051*** (0.002)
2014 0.084*** (0.009) 0.122*** (0.007) 0.108*** (0.006) 0.106*** (0.006) 0.095*** (0.004)
Personal characteristics No Yes Yes Yes Yes
Work-related characteristics No No Yes Yes Yes
Observed firm and establishment characteristics No No No Yes No
Establishment fixed effects No No No No Yes

Sample means for establishments

2006 2014
Firm and establishment characteristics
Firm size
  10–49 employees 0.57 0.41
  50–249 employees 0.20 0.16
  250–499 employees 0.08 0.13
  500–999 employees 0.06 0.13
  1000+ employees 0.10 0.16
Collective agreement coverage of the establishment 4.74 0.05
Industry of the establishment
  Mining and quarrying 0.01 0.01
  Manufacturing 0.35 0.24
  Electricity, gas, and water supply 0.02 0.02
  Construction 0.05 0.05
  Wholesale and retail trade 0.24 0.31
  Hotels and restaurants 0.05 0.06
  Transport, storage, and communication 0.08 0.05
  Financial intermediation 0.06 0.05
  Real estate, renting and business activities 0.06 0.11
  Education 0.04 0.03
  Health and social work 0.02 0.03
  Other social and personal service activities 0.02 0.04
Number of establishments 12,874 7,867

SES sample coverage by year

Year SESaTotal number of employeesb(1) HLFScTotal employment(2) HLFSTotal number of employees (formal and informal)(3) HLFSTotal number of employees (formal)(4) (3)/(2) (4)/(3) (1)/(4)
2006 5,986,247 20,423,000 12,028,000 8,242,000 0.59 0.69 0.73
2014 9,651,017 25,932,000 17,125,000 13,777,000 0.66 0.80 0.70

Sample means across all establishments

2006 2014
All Males Females All Males Females
Personal characteristics
Educational attainment
  Primary school and below 0.27 0.31 0.19 0.17 0.19 0.15
  Primary education and secondary school 0.15 0.16 0.11 0.15 0.18 0.11
  High school 0.24 0.23 0.28 0.28 0.27 0.29
  Vocational high school 0.10 0.11 0.09 0.08 0.10 0.06
  Higher education 0.23 0.19 0.33 0.31 0.27 0.40
Potential labor market experience (years) 17.09 18.23 14.01 17.40 18.30 15.32
Work-related characteristics
Tenure (years) 3.67 3.92 3.03 3.18 3.39 2.70
Full-time 0.99 0.99 0.99 0.98 0.98 0.98
Permanent contract 0.96 0.96 0.97 0.93 0.94 0.93
Overtime work 0.14 0.15 0.11 0.20 0.22 0.15
Firm and establishment characteristics
  Firm size (number of employees)
    10–49 0.46 0.46 0.46 0.32 0.32 0.32
    50–249 0.24 0.24 0.24 0.19 0.20 0.18
    250–499 0.10 0.10 0.10 0.17 0.17 0.17
    500–999 0.08 0.08 0.08 0.16 0.16 0.17
    1000+ 0.12 0.12 0.11 0.15 0.15 0.16
  Collective agreement coverage of the establishment 0.10 0.12 0.06 0.10 0.12 0.08
  Industry of the establishment
    Mining and quarrying 0.01 0.02 0.01 0.02 0.02 0.01
    Manufacturing 0.42 0.44 0.37 0.33 0.36 0.25
    Electricity, gas, and water supply 0.03 0.03 0.01 0.02 0.02 0.01
    Construction 0.04 0.05 0.02 0.04 0.04 0.02
    Wholesale and retail trade 0.19 0.19 0.20 0.23 0.23 0.23
    Hotels and restaurants 0.05 0.05 0.04 0.06 0.06 0.06
    Transport, storage, and communication 0.07 0.07 0.06 0.06 0.06 0.06
    Financial intermediation 0.04 0.03 0.07 0.04 0.03 0.06
    Real estate, renting and business activities 0.06 0.06 0.07 0.11 0.10 0.13
    Education 0.04 0.03 0.07 0.04 0.03 0.06
    Health and social work 0.03 0.02 0.06 0.04 0.02 0.08
    Other social and personal service activities 0.02 0.02 0.02 0.03 0.03 0.03
  Occupation
    Legislators, senior officials, and managers 0.06 0.06 0.05 0.06 0.06 0.05
    Professionals 0.08 0.06 0.13 0.12 0.10 0.16
    Technicians and associate professionals 0.17 0.16 0.21 0.09 0.10 0.09
    Clerks 0.12 0.09 0.22 0.15 0.11 0.24
    Service workers; shop and market sales’ workers 0.11 0.11 0.09 0.19 0.18 0.22
    Skilled agricultural and fishery workers 0.002 0.003 0.001 0.001 0.001 0.001
    Craft and related trade workers 0.19 0.21 0.11 0.13 0.17 0.05
    Plant and machine operators and assemblers 0.13 0.15 0.06 0.13 0.15 0.07
    Elementary occupations 0.14 0.15 0.13 0.13 0.12 0.13
Region
  Istanbul – – – 0.27 0.25 0.30
  West Marmara – – – 0.07 0.07 0.07
  Aegean – – – 0.11 0.11 0.12
  East Marmara – – – 0.12 0.12 0.10
  West Anatolia – – – 0.10 0.10 0.11
  Mediterranean – – – 0.09 0.09 0.08
  Central Anatolia – – – 0.06 0.06 0.05
  West Black Sea – – – 0.04 0.04 0.05
  East Black Sea – – – 0.04 0.04 0.05
  Northeast Anatolia – – – 0.02 0.03 0.02
  Central East Anatolia – – – 0.03 0.04 0.03
  Southeast Anatolia – – – 0.04 0.05 0.04
Number of observations 241,361 175,938 65,423 132,235 91,881 40,354
Number of establishments 12,874 7,867

Sensitivity analysis, BO decomposition of the mean GWG using the female coefficients as the baseline

Specification
(2a) (2b) (2c) (2d)
2006
Raw GWG 0.024*** (0.006) 0.024*** (0.006) 0.024*** (0.006) 0.024*** (0.006)
Explained gap −0.041*** (0.003) −0.031*** (0.004) −0.032*** (0.005) −0.012*** (0.001)
[−174.8%] [−131.3%] [−133.6%] [−48.8%]
Unexplained gap 0.065*** (0.005) 0.055*** (0.004) 0.055*** (0.004) 0.035*** (0.002)
[274.8%] [231.3%] [233.6%] [148.8%]
2014
Raw GWG 0.084*** (0.008) 0.084*** (0.008) 0.084*** (0.008) 0.084*** (0.008)
Explained gap −0.045*** (0.005) −0.024*** (0.005) −0.023*** (0.006) 0.001 (0.002)
[−54.1%] [−28.1%] [−28.0%] [1.7%]
Unexplained gap 0.129*** (0.007) 0.108*** (0.006) 0.107*** (0.006) 0.083*** (0.003)
[154.1%] [128.1%] [128.0%] [98.3%]

Sensitivity analysis, PSM estimation of the GWG

Specification 2006 2014
Without occupation and industry Treated Controls Difference Robust S.E. Treated Controls Difference Robust S.E.
Unmatched 1.127 1.151 −0.024*** 0.003 1.203 1.287 −0.084*** 0.004
Matched 1.127 1.155 −0.028*** 0.003 1.203 1.286 −0.084*** 0.004
With industry Treated Controls Difference S.E. Treated Controls Difference S.E.
Unmatched 1.127 1.151 −0.024*** 0.003 1.203 1.287 −0.084*** 0.004
Matched 1.127 1.148 −0.021*** 0.003 1.203 1.287 −0.084*** 0.005
With industry and occupation Treated Controls Difference S.E. Treated Controls Difference S.E.
Unmatched 1.127 1.151 −0.024*** 0.003 1.203 1.287 −0.084*** 0.004
Matched 1.127 1.146 −0.020*** 0.004 1.203 1.268 −0.065*** 0.005

Sensitivity analysis, adjusted GWG, 2006

Specification Selected percentiles of the wage distribution OLS
10th 25th 50th 75th 90th mean
(2a) personal characteristics
  Benchmark 0.001 (0.001) 0.001 (0.001) 0.042*** (0.004) 0.107*** (0.012) 0.077*** (0.012) 0.051*** (0.005)
  Sample (aged 18–64 years) 0.001 (0.001) 0.001 (0.001) 0.045*** (0.005) 0.107*** (0.012) 0.076*** (0.012) 0.051*** (0.005)
  Weighteda 0.001 (0.001) 0.001 (0.001) 0.091*** (0.011) 0.125*** (0.022) 0.072* (0.029) 0.064*** (0.010)
  Conditional quantile regression 0.000 (0.000) −0.000 (0.000) 0.027*** (0.003) 0.056*** (0.005) 0.064*** (0.008) 0.051*** (0.005)
(2b) personal and work-related characteristics
  Benchmark 0.001 (0.001) 0.001 (0.001) 0.037*** (0.004) 0.100*** (0.010) 0.072*** (0.012) 0.048*** (0.004)
  Sample (aged 18–64 years) 0.001 (0.001) 0.001 (0.001) 0.040*** (0.004) 0.100*** (0.010) 0.071*** (0.012) 0.048*** (0.004)
  Weighteda 0.001 (0.001) 0.001 (0.001) 0.088*** (0.010) 0.127*** (0.019) 0.070** (0.025) 0.064*** (0.008)
  Conditional quantile regression 0.001 (0.001) 0.004*** (0.000) 0.024*** (0.002) 0.057*** (0.004) 0.075*** (0.008) 0.048*** (0.004)
  Excluding overtime 0.001 (0.001) 0.001 (0.001) 0.045*** (0.004) 0.109*** (0.011) 0.074*** (0.012) 0.053*** (0.004)
  Including occupation 0.001 (0.001) 0.001 (0.001) 0.052*** (0.004) 0.133*** (0.010) 0.067*** (0.011) 0.057*** (0.004)
(2c) personal, work-related, observed firm and establishment characteristics
  Benchmark 0.001 (0.001) 0.001 (0.001) 0.040*** (0.004) 0.089*** (0.009) 0.070*** (0.011) 0.048*** (0.004)
  Sample (aged 18–64 years) 0.000 (0.001) 0.000 (0.001) 0.041*** (0.004) 0.088*** (0.009) 0.070*** (0.011) 0.048*** (0.004)
  Weighteda 0.000 (0.001) 0.000 (0.001) 0.083*** (0.009) 0.105*** (0.016) 0.063** (0.022) 0.057*** (0.007)
  Conditional quantile regression 0.005*** (0.001) 0.011*** (0.002) 0.024*** (0.002) 0.043*** (0.004) 0.056*** (0.006) 0.048*** (0.004)
  Excluding overtime 0.001 (0.001) 0.001 (0.001) 0.044*** (0.004) 0.089*** (0.009) 0.068*** (0.011) 0.049*** (0.004)
  Including occupation 0.001 (0.001) 0.001 (0.001) 0.048*** (0.004) 0.101*** (0.009) 0.053*** (0.011) 0.048*** (0.004)
  Including detailed industryc −0.000 (0.001) −0.000 (0.001) 0.027*** (0.004) 0.062*** (0.009) 0.058*** (0.011) 0.036*** (0.004)
(2d) personal and work-related characteristics and establishment fixed effects
  Benchmark 0.001*** (0.000) 0.001*** (0.000) 0.026*** (0.002) 0.082*** (0.006) 0.111*** (0.008) 0.051*** (0.002)
  Sample (aged 18–64 years) 0.001*** (0.000) 0.001*** (0.000) 0.027*** (0.002) 0.082*** (0.006) 0.110*** (0.008) 0.051*** (0.002)
  Weighteda 0.001*** (0.000) 0.001*** (0.000) 0.045*** (0.005) 0.079*** (0.012) 0.088*** (0.013) 0.050*** (0.004)
  Conditional quantile regression 0.004*** (0.001) 0.010*** (0.001) 0.023*** (0.001) 0.043*** (0.002) 0.074*** (0.004) 0.051*** (0.002)
  Excluding overtime 0.001*** (0.000) 0.001*** (0.000) 0.027*** (0.002) 0.075*** (0.006) 0.101*** (0.008) 0.048*** (0.002)
  Including occupation 0.001*** (0.000) 0.001*** (0.000) 0.028*** (0.002) 0.075*** (0.006) 0.077*** (0.008) 0.042*** (0.002)

Variable definitions

Variable Type Definition
Log hourly gross wage Continuous Constructed by the author: the monthly gross wage (the sum of monthly basic wages, overtime payments, payments for shift work/night work, and other regular payments paid to employees) in the reference montha divided by monthly paid hours (the sum of contractual working hours pertaining to basic wage and overtime hours worked) during the reference month (deflated using the Consumer Price Index base year 2003, in 2003 TRY)
Gender Binary Recoded by the author as follows: {0female1male \left\{ {\matrix{ 0 & {{\rm{female}}} \hfill \cr 1 & {{\rm{male}}} \hfill \cr } } \right.
Educational attainment Categorical The highest successfully completed level of education which the employee has received according to the International Standard Classification of Education (ISCED 97 in 2006 and ISCED 2011 in 2014). {1primary school and below2primary education and seconday eduction3high school4vocational high school5higher education \left\{ {\matrix{ 1 \hfill & {{\rm{primary}}\,{\rm{school}}\,{\rm{and}}\,{\rm{below}}} \hfill \cr 2 \hfill & {{\rm{primary}}\,{\rm{education}}\,{\rm{and}}\,{\rm{seconday}}\,{\rm{eduction}}} \hfill \cr 3 \hfill & {{\rm{high}}\,{\rm{school}}} \hfill \cr 4 \hfill & {{\rm{vocational}}\,{\rm{high}}\,{\rm{school}}} \hfill \cr 5 \hfill & {{\rm{higher}}\,{\rm{education}}} \hfill \cr } } \right.
Potential labor market experience Continuous Constructed by the author: age–years of schooling–6. Years of schooling are taken as 5 years for primary school and below, 8 years for primary education and secondary education, 11 years for high school and vocational high school, and 14 years for higher education following Cebeci (2015).
Tenure Continuous The total length of service in the firm to which the establishment belongs in the reference month (in years).
Full-time employment Binary Contractual working time. Recoded by the author as: {0if part-time1if full time \left\{ {\matrix{ 0 & {{\rm{if}}\,{\rm{part{\text -}time}}} \hfill \cr 1 & {{\rm{if}}\,{\rm{full}}\,{\rm{time}}} \hfill \cr } } \right.
Type of employment contract Binary Type of employment contract of the worker. Recoded by the author as: {0if temporary (fixed-term) contact1if permanent contact \left\{ {\matrix{ 0 \hfill & {{\rm{if}}\,{\rm{temporary}}\,\left( {{\rm{fixed {\text -} term}}} \right)\,{\rm{contact}}} \hfill \cr 1 \hfill & {{\rm{if}}\,{\rm{permanent}}\,{\rm{contact}}} \hfill \cr } } \right.
Overtime work Binary Constructed by the author based on the monthly hours of overtime work during the reference month. Recoded by the author as: {0if total monthly hours of overtime work is zero1if total monthly hours of overtime work greater than zero \left\{ {\matrix{ 0 \hfill & {{\rm{if}}\,{\rm{total}}\,{\rm{monthly}}\,{\rm{hours}}\,{\rm{of}}\,{\rm{overtime}}\,{\rm{work}}\,{\rm{is\, zero}}} \hfill \cr 1 \hfill & {{\rm{if}}\,{\rm{total}}\,{\rm{monthly}}\,{\rm{hours}}\,{\rm{of}}\,{\rm{overtime}}\,{\rm{work}}\,{\rm{greater}}\,{\rm{than}}\,{\rm{zero}}} \hfill \cr } } \right.
Firm size Categorical Size of the firm (in terms of number of employees) to which the establishment belongs. {1if 10−492if 50−2493if 250−4994if 500−9995if 1000 and more \left\{ {\matrix{ 1 \hfill & {{\rm{if}}\,10 - 49} \hfill \cr 2 \hfill & {{\rm{if}}\,50 - 249} \hfill \cr 3 \hfill & {{\rm{if}}\,250 - 499} \hfill \cr 4 \hfill & {{\rm{if}}\,500 - 999} \hfill \cr 5 \hfill & {{\rm{if}}\,1000\,{\rm{and\, more}}} \hfill \cr } } \right.
Collective agreement coverage Binary Collective agreement coverage of the establishment. Recoded by the author as: {0if no collective pay aggrement exists in the establishment1otherwise \left\{ {\matrix{ 0 \hfill & {{\rm{if}}\,{\rm{no}}\,{\rm{collective}}\,{\rm{pay}}\,{\rm{aggrement}}\,{\rm{exists}}\,{\rm{in}}\,{\rm{the}}\,{\rm{establishment}}} \hfill \cr 1 \hfill & {{\rm{otherwise}}} \hfill \cr } } \right.
Industry Categorical Principal economics activity of the establishment coded according to the Statistical Classification of Economic Activities in the European Community (NACE Rev. 1.1 in 2006 and NACE Rev. 2 in 2014). Recoded by the author at section level according to NACE Rev. 2 (12 categories).
Occupation Categorical Occupation of the employee in the reference month coded according to the ISCO88 in 2006 and ISCO 08 in 2014. Recoded by the author at one-digit ISCO 08 level (9 categories)
Regionb Categorical Region of the establishment codded according to the NUTS-1 – only available in 2014 (12 categories)

Sensitivity analysis, adjusted GWG, 2014

Specification Selected percentiles of the wage distribution OLS
10th 25th 50th 75th 90th Mean
(2a) Personal characteristics
  Benchmark 0.011*** (0.002) 0.011*** (0.002) 0.175*** (0.008) 0.172*** (0.011) 0.143*** (0.016) 0.122*** (0.007)
  Sample (aged 18–64 years) 0.011*** (0.002) 0.012*** (0.002) 0.177*** (0.008) 0.171*** (0.011) 0.140*** (0.016) 0.123*** (0.007)
  Weighteda 0.015** (0.005) 0.013** (0.004) 0.140*** (0.013) 0.132*** (0.019) 0.064 (0.033) 0.092*** (0.012)
  Conditional quantile regression 0.038*** (0.006) 0.025*** (0.002) 0.096*** (0.005) 0.148*** (0.007) 0.153*** (0.009) 0.122*** (0.007)
(2b) Personal and work-related characteristics
  Benchmark 0.009*** (0.002) 0.009*** (0.002) 0.155*** (0.007) 0.154*** (0.010) 0.138*** (0.016) 0.108*** (0.006)
  Sample (aged 18–64 years) 0.009*** (0.002) 0.010*** (0.002) 0.157*** (0.007) 0.153*** (0.010) 0.135*** (0.016) 0.108*** (0.006)
  Weighteda 0.012** (0.005) 0.011** (0.004) 0.121*** (0.012) 0.110*** (0.016) 0.048 (0.033) 0.074*** (0.011)
  Conditional quantile regression 0.037*** (0.005) 0.041*** (0.003) 0.068*** (0.004) 0.129*** (0.007) 0.162*** (0.008) 0.108*** (0.006)
  Excluding overtime 0.010*** (0.002) 0.010*** (0.002) 0.164*** (0.007) 0.152*** (0.010) 0.126*** (0.016) 0.111*** (0.006)
  Including occupation 0.011*** (0.002) 0.011*** (0.002) 0.154*** (0.007) 0.153*** (0.010) 0.113*** (0.016) 0.103*** (0.006)
(2c) Personal, work-related, observed firm and establishment characteristics
  Benchmark 0.011*** (0.002) 0.012*** (0.002) 0.146*** (0.007) 0.143*** (0.010) 0.124*** (0.015) 0.106*** (0.006)
  Sample (aged 18–64 years) 0.011*** (0.002) 0.012*** (0.002) 0.148*** (0.007) 0.141*** (0.010) 0.121*** (0.015) 0.106*** (0.006)
  Weighteda 0.014*** (0.004) 0.013*** (0.004) 0.122*** (0.012) 0.120*** (0.018) 0.094** (0.032) 0.090*** (0.012)
  Conditional quantile regression 0.058*** (0.006) 0.052*** (0.004) 0.077*** (0.004) 0.112*** (0.006) 0.141*** (0.008) 0.106*** (0.006)
  Excluding overtime 0.012*** (0.002) 0.012*** (0.002) 0.149*** (0.007) 0.136*** (0.010) 0.109*** (0.015) 0.105*** (0.006)
  Including occupation 0.012*** (0.002) 0.012*** (0.002) 0.138*** (0.007) 0.125*** (0.009) 0.081*** (0.015) 0.092*** (0.006)
  Including detailed industryb 0.010*** (0.002) 0.010*** (0.001) 0.127*** (0.007) 0.122*** (0.009) 0.116*** (0.015) 0.095*** (0.005)
  Including regionc 0.013*** (0.002) 0.012*** (0.002) 0.160*** (0.007) 0.148*** (0.009) 0.123*** (0.015) 0.113*** (0.006)
(2d) Personal and work-related characteristics and establishment fixed effects
  Benchmark 0.006*** (0.001) 0.006*** (0.001) 0.113*** (0.004) 0.132*** (0.007) 0.170*** (0.011) 0.095*** (0.004)
  Sample (aged 18–64 years) 0.006*** (0.001) 0.006*** (0.001) 0.114*** (0.004) 0.131*** (0.007) 0.168*** (0.011) 0.095*** (0.004)
  Weighteda 0.007* (0.003) 0.006** (0.002) 0.103*** (0.008) 0.119*** (0.016) 0.150*** (0.033) 0.089*** (0.012)
  Conditional quantile regression 0.030*** (0.004) 0.039*** (0.003) 0.061*** (0.003) 0.099*** (0.004) 0.147*** (0.006) 0.095*** (0.004)
  Excluding overtime 0.007*** (0.001) 0.007*** (0.001) 0.115*** (0.004) 0.124*** (0.007) 0.152*** (0.011) 0.094*** (0.004)
  Including occupation 0.006*** (0.001) 0.006*** (0.001) 0.102*** (0.004) 0.109*** (0.007) 0.113*** (0.011) 0.076*** (0.004)

Components of the BO decomposition of the mean GWG, 2014

Specification
(2a) (2b) (2c) (2d)
Raw GWG 0.084*** (0.008) 0.084*** (0.008) 0.084*** (0.008) 0.084*** (0.003)
Explained gap −0.035*** (0.005) −0.024*** (0.005) −0.019*** (0.006) −0.008*** (0.002)
[−41.9%] [−29.1%] [−22.8%] [−9.0%]
Unexplained gap 0.119*** (0.007) 0.108*** (0.006) 0.103*** (0.006) 0.092*** (0.003)
Explained [141.9%] [129.1%] [122.8%] [109.0%]
Personal characteristics
Education −0.115*** (0.005) −0.109*** (0.005) −0.101*** (0.004) −0.066*** (0.002)
[−137.0%] [−129.6%] [−119.7%] [−79.2%]
Potential labour market experience 0.080*** (0.003) 0.051*** (0.002) 0.054*** (0.002) 0.045*** (0.001)
[95.2%] [61.2%] [64.9%] [54.0%]
Work-related characteristics
Tenure 0.028*** (0.002) 0.023*** (0.002) 0.017*** (0.001)
[33.5%] [27.0%] [20.6%]
Permanent contract 0.000 (0.001) 0.000 (0.001) 0.000 (0.000)
[0.3%] [0.3%] [0.6%]
Full-time −0.000 (0.000) −0.000 (0.000) −0.001*** (0.000)
[−0.3%] [−0.3%] [−1.3%]
Overtime work 0.005*** (0.001) −0.001 (0.001) −0.003*** (0.000)
[5.8%] [−1.2%] [−3.7%]
Observed firm and establishment characteristics
Firm size −0.002 (0.002)
[−1.9%]
Collective agreement coverage 0.003*** (0.001)
[3.8%]
Industry of the establishment 0.004 (0.003)
Unexplained [4.3%]
Characteristics 0.054** (0.017) 0.133* (0.056) 0.072 (0.059) 0.110** (0.033)
[64.0%] [157.9%] [85.6%] [130.8%]
Constant 0.065*** (0.018) −0.024 (0.057) 0.031 (0.060) −0.018 (0.033)
[77.8%] [−28.8%] [37.2%] [−21.8%]
eISSN:
2520-1786
Language:
English
Publication timeframe:
Volume Open
Journal Subjects:
Business and Economics, Political Economics, Microeconomics, Macroecomics, Economic Policy, Mathematics and Statistics for Economists, Econometrics
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