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Public-Private Sector Pay Gaps in Finland: A Quantile Regression Analysis

Terhi Maczulskij () and Jaakko Pehkonen ()
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Jaakko Pehkonen: School of Business and Economics, University of Jyväskylä

Finnish Economic Papers, 2011, vol. 24, issue 2, 111-127

Abstract: This paper examines public-private sector wage differentials in Finland using a quantile regression method. We control for the endogeneity of the working sector and allow the returns of individual skills to vary between industries. The results suggest that men earn a premium of 3 percent in the public sector at the lower-end jobs. At the median and the upper end of the distribution, men’s pay gap is negative, varying between 5 and 10 percent. Women, in turn, always earn more in the public sector (4–10 percent), and the premium is highest at the upper end of the earnings distribution.

JEL-codes: J31 J45 (search for similar items in EconPapers)
Date: 2011
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