Changes in the Gender Wage Gap in Germany during a Period of Rising Wage Inequality 1999-2006: Was it Discrimination in the Returns to Human Capital?

Usamah Fayez Al-Farhan

No 293, SOEPpapers on Multidisciplinary Panel Data Research from DIW Berlin, The German Socio-Economic Panel (SOEP)

Abstract: In this article I analyze the changes in the gender wage gap in the western region, eastern region and in reunified Germany during the period 1999 - 2006. I use data from the German Socio-Economic Panel and implement two alternative decomposition methodologies; the Juhn, Murphy and Pierce (1991) decomposition, and a methodology that totally differences the Oaxaca-Blinder (1973) decomposition, found in Smith and Welch (1989). I conclude that most of the increase in the gender wage gap occurred during a period of remarkably risingwage inequality and argue that both trends are caused simultaneously by the same set of factors. Furthermore, German women were, on average, treated favorably in the returns to their educational attainment, potential experience and tenure compared men, and that the increasing gender wage gap was mainly due to changes in the gender differentials in human capital endowments, particularly worker's potential experience, changes in the gender distribution across industries, company sizes and occupational positions and to changes in discrimination in the returns to job-specific training.

Keywords: Wages; gaps; discrimination; decomposition; characteristics effect; coefficient effect (search for similar items in EconPapers)
JEL-codes: D30 J31 (search for similar items in EconPapers)
Pages: 91 p.
Date: 2010
New Economics Papers: this item is included in nep-hrm, nep-lab and nep-tra
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:diw:diwsop:diw_sp293

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