A New View of the Male/Female Pay Gap

Michael Baker and Marie Drolet

CLSSRN working papers from Vancouver School of Economics

Abstract: We construct a new time series on the Canadian female/male pay ratio. The new series is based on wage data rather than the earnings data that has been used in the past. Wages more closely correspond to the price of labour, which is the focus of most theories of labour market discrimination and public policies in this area. Earnings based estimates combine gender differences in wages with gender differences in decisions of how much to work (i.e., hours). Our results reveal significant differences between the wage and earnings based series. Most importantly the wage series reveals that women have continued to make progress in the last fifteen years. In 2006 the wage based ratio is 0.85 while the earnings based ratio is only 0.72. We also find that as the gender wage ratio has risen, the remaining gap in wages is increasingly unexplained in the sense that it cannot be accounted for by gender differences in characteristics that the labour market values.

Keywords: Gender Pay Gap; Wages; Earnings (search for similar items in EconPapers)
JEL-codes: J31 (search for similar items in EconPapers)
Pages: 54 pages
Date: 2009-12-28, Revised 2009-12-28
New Economics Papers: this item is included in nep-lab
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Journal Article: A New View of the Male/Female Pay Gap (2010)
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