Bridging the gender wage gap: the role of education in developing economies

Nguyet Thi Nguyen, Phung Van Anh, Kumba Digdowiseiso and Nur Afni

Journal of Economic Studies, 2025, vol. 53, issue 3, 474-492

Abstract: PurposeThis study evaluates the determinants of gender wage gaps in developing countries under the globalization context, focusing on Vietnam and Indonesia from 1993 to 2010.Design/methodology/approachUsing an extended decomposition model based on Oaxaca (1973) and Blinder (1973) and panel data from national household surveys, the research reveals nuanced insights into the dynamics of wage inequality.FindingsThis research underscores the critical role of education, policy reforms, and cultural dynamics in shaping gender wage equality, offering actionable insights for policymakers in transitional and developing economies. The findings highlight the phenomena of “gender twist” and “sticky floor” in Vietnam, where reforms and globalization initially narrowed gender wage disparities but later posed new challenges under intensified competition. Education emerges as a pivotal factor, significantly reducing wage gaps in both countries, though its effectiveness varies.Originality/valueIn Vietnam, higher education shows diminishing returns in the globalization era, whereas in Indonesia, education consistently enhances gender wage parity. Structural reforms and globalization exert complex, context-dependent influences, with Vietnam leveraging reforms more effectively but facing persistent cultural and institutional barriers. Indonesia’s reforms, while impactful, often struggle against systemic biases amplified during economic shocks.

Keywords: Gender wage gap; Education; Globalization; Developing countries; Vietnam; Indonesia (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jespps:jes-12-2024-0840

DOI: 10.1108/JES-12-2024-0840

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