Public-Private sector Pay gaPs in Finland: a quantile regression analysis *

Terhi Maczulskij, Jaakko Pehkonen
2011 Finnish Economic Papers   unpublished
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
more » ... (4-10 percent), and the premium is highest at the upper end of the earnings distribution. (JEL: J31, J45)