Can the Introduction of a Minimum Wage in FYR Macedonia Decrease the Gender Wage Gap?

Diego F. Angel-Urdinola ()
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Diego F. Angel-Urdinola: The World Bank, Postal: 1818 H Street, N.W., Washington, DC 20433

No 4795, Policy Research Working Paper Series from The World Bank

Abstract: This paper relies on a simple framework to understand the gender wage gap in Macedonia, and simulates how the gender wage gap would behave after the introduction of a minimum wage. First, it presents a newâÃÂÃÂalbeit simpleâÃÂÃÂdecomposition of the wage gap into three factors: (i) a wage level factor, which measures the extent to which the gender gap is driven by differences in wage levels among low-skilled workers of opposite sex; (ii) a skills endowment factor, which quantifies the extent to which the gender wage gap is driven by the difference in the share of high-skilled workers by gender; and (iii) returns to education, which measures the extent to which the gender gap is driven by differences by gender in returns to education. Second, the paper presents simple set of simulations that indicate that the introduction of a minimum wage in Macedonia could contribute to decrease the gender wage gap by up to 23 percent. Nevertheless, in order to significantly improve the wage gap, a rather high minimum wage may be required, which may contribute to reductions in employment.

Keywords: Minimum wages; Gender Gap; Wage Differentials; Macedonia (search for similar items in EconPapers)
JEL-codes: I32 J23 J38 J71 (search for similar items in EconPapers)
Pages: 16 pages
Date: 2008-12-01
New Economics Papers: this item is included in nep-dev and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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