Public-private wage gap in Latin America (1992-2007): A matching approach

Alejandra Mizala, Pilar Romaguera, Sebastián Gallegos

Research output: Contribution to journalArticlepeer-review

26 Scopus citations

Abstract

Using matching methods, we estimate the public-private wage gap for urban workers in eleven Latin American countries for the 1992-2007 period. These methods do not require any estimation of earnings equations and hence no validity-out-of-the-support assumptions; furthermore, this approach allows us to estimate not only the average wage gap but also its distribution. Our main findings indicate that the average public sector worker earns more than his/her private counterpart, and that this differential increased over the 1992-2007 period. Important differences along the wage distribution are also shown in the results; in fact, public servants in the highest percentiles of the wage distribution generally earn less than their private sector equivalents. Nonetheless, the percentile at which a positive wage gap becomes a wage penalty shifted over the period as the average wage gap experienced by most countries widened. Still, the most qualified public sector workers do face a wage penalty. Furthermore, indicators of government effectiveness show no relationship with the country ranking according to the public-private wage gap.

Original languageEnglish
Pages (from-to)S115-S131
JournalLabour Economics
Volume18
Issue numberSUPPL. 1
DOIs
StatePublished - Dec 2011
Externally publishedYes

Keywords

  • Government effectiveness
  • Latin America
  • Matching
  • Public sector
  • Public-private wage gap

Fingerprint

Dive into the research topics of 'Public-private wage gap in Latin America (1992-2007): A matching approach'. Together they form a unique fingerprint.

Cite this