Regional heterogeneity in wage distributions. Evidence from Spain
Download
1 / 6

IAREG 2 - PowerPoint PPT Presentation


  • 118 Views
  • Uploaded on

Regional heterogeneity in wage distributions. Evidence from Spain Elisabet Motellón Enrique López-Bazo Mayssun El-Attar AQR – IREA, UOC, EUI. ASSUMPTIONS

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about ' IAREG 2' - danno


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript

Regional heterogeneity in wage distributions. Evidence from SpainElisabet MotellónEnrique López-BazoMayssun El-AttarAQR – IREA, UOC, EUI


  • ASSUMPTIONS Spain

  • Regional differentials in productivity and thus in wages are the result of different endowment of characteristics and of regional heterogeneity in their price/return.

  • Important role of regional endowment of HK and of differences in the return that workers obtain from investments in HK.

  • OBJECTIVES

  • General

    • To prove that regional heterogeneity in the return to HK is the major responsible of wage differentials across regions.

  • Specifics

    • To assess the magnitude of regional gaps in nominal and real wages

    • To decompose the regional wage gap into the contribution of endowments and prices of worker and firm characteristics

    • To measure the contribution of HK, both endowment and return, on regional wage disparities

Intangible assets & regional economic growth

Intangible assets & regional economic growth

IAREG2


DATABASE Spain

Wage Structure Survey for Spain (INE & EUROSTAT):

- matched employer-employee dataset  micro-data on wages and worker and firm characteristics

- includes workers in establishments of at least 10 employees

Spatial units: Spanish NUTS II regions  17 Comunidades Autónomas

Two groups: Low wage regions vs High wage regions

Periods: 1995 & 2002

Main variables:

- gross hourly wage (raw wage + complements) in October

- HK  years of schooling, tenure, experience

Intangible assets & regional economic growth

Intangible assets & regional economic growth

IAREG3


  • METHODOLOGY Spain

  • Wage gap decomposition for the entire distribution, and assessment of role of HK

  • Steps:

    • 1. Mincerian equations for high-wage (HW) and low-wage (LW) regions

    • 2. Estimation of counterfactual wagesfor the LW, with wage structure (prices) of HW

    • 3. Counterfactual wages for LW with returns to human capital of HW

    • 4. Comparison of actual and counterfactual wage distributions

    •  Effect of differences in return to HK on regional disparities in wage distributions

Intangible assets & regional economic growth

Intangible assets & regional economic growth

IAREG4


  • MAIN RESULTS Spain

  • Differences in regional wages not only in the first moment of the wage distribution, but also in its dispersion and shape.

  • Minor role for compensating differentials (cost of living ) and structural variation (endowment of characteristics)

  • Differences in regional wage distributions mostly explained by regional heterogeneity in returns (particularly in 2002)

  • Outstanding role of returns to human capital, with no effect of returns to job and firm characteristics.

  • Effects are not homogeneous along the wage distribution. Affect the mean, dispersion and shape

Intangible assets & regional economic growth

Intangible assets & regional economic growth

IAREG5


GENERAL CONCLUSION Spain

Regional convergence in worker (HK) and job and firm characteristics  non effective to reduce regional wage gaps as they are mostly caused by heterogeneity in returns (particularly to HK).

 Homogenization of regional wage distributions can only be achieved by convergence in (private) returns to human capital

Intangible assets & regional economic growth

Intangible assets & regional economic growth

IAREG6


ad