Hidden in Plain Sight: Occupational Structure and the Gender Wage Gap

Riccarda Rosenball (), Tobias Eibinger (), Joern Kleinert () and Ismir Mulalic ()
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Riccarda Rosenball: Department of Economics, University of Graz
Tobias Eibinger: Department of Economics, University of Graz
Joern Kleinert: Department of Economics, University of Graz
Ismir Mulalic: Department of Economics, Copenhagen Business School

No 2026-11, Graz Economics Papers from University of Graz, Department of Economics

Abstract: This paper studies the role of occupational segregation in shaping gender differences in firm sorting and wages. We show theoretically and in simulations that standard AKM models that omit occupations misattribute part of occupation-specific wage premia to worker and firm effects, thereby inflating the gender pay gap. Using Danish register data, we find that accounting for occupations reduces the estimated contribution of firm sorting by up to 30%. Occupational segregation itself is of comparable importance to firm sorting in explaining the gender gap. Our findings suggest that gender differences in firm sorting are closely linked to occupational and industry segregation.

Keywords: wages; gender wage inequality; occupational segregation; AKM (search for similar items in EconPapers)
JEL-codes: J16 J70 J81 (search for similar items in EconPapers)
Date: 2026-06
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