Open AccessFirm Pay Policies and the Gender Earnings Gap: The Mediating Role of Marital and Family Status
Author(s) -
Jiang Li,
Benoît Dostie,
Gaëlle SimardDuplain
Publication year - 2022
Publication title -
industrial and labor relations review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.927
H-Index - 78
eISSN - 2162-271X
pISSN - 0019-7939
DOI - 10.1177/00197939221093562
Subject(s) - earnings , demographic economics , wage , quarter (canadian coin) , labour economics , gender gap , marital status , economics , gender pay gap , business , accounting , population , demography , archaeology , sociology , history
Using data from the Canadian Employer-Employee Dynamics Database between 2001 and 2015, the authors examine the impact of firms’ hiring and pay-setting policies on the gender earnings gap in Canada. Consistent with the existing literature and following Card, Cardoso, and Kline (2016), findings show that firm-specific premiums explain nearly one-quarter of the 26.8% average earnings gap between female and male workers. On average, firms’ hiring practices, due to differences in the relative proportion of women hired at high-wage firms (known as sorting), and pay-setting policies, due to differences in pay by gender within similar firms, each explain approximately one-half of this firm effect. The compositional difference between the two channels varies substantially over a worker’s life cycle, by parental and marital status, and across provinces.