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Title: Industrial Composition, Bargaining, and the Gender Wage Gap: Evidence from U.S. Cities

Citation Type: Miscellaneous

Publication Year: 2009

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Abstract: We propose, and empirically evaluate, a theory of the labor market in whichdifferences in pay between otherwise identical workers arise as a consequence of(endogenous) differences in bargaining conditions. We use the model to help explaintrends in the gender wage gap, and explore the plausibility of the theory byemploying a city-level analysis using U.S. census data for the 1970-2007 period.We address potential endogeneity by exploiting the time dimension of the data,as well via instrumental variables methods. We find considerable support for themodel: bargaining effects are correct-signed and significant in virtually all specifications,and our preferred estimates indicate that bargaining effects are roughlyof the same magnitude as mechanical composition effects.

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Authors: Bidner, Chris; Sand, Ben

Publisher: University of New South Wales

Data Collections: IPUMS USA

Topics: Gender, Labor Force and Occupational Structure, Other

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