Open AccessWhat drives wages differentials in Greece: workplaces or workers?
Author(s) -
Θεοδώρα Κοσμά,
Pavlos Petroulas,
Evangelia Vourvachaki
Publication year - 2020
Publication title -
economic bulletin - bank of greece/economic bulletin - bank of greece
Language(s) - English
Resource type - Journals
eISSN - 2654-1904
pISSN - 1105-9729
DOI - 10.52903/econbull20205203
Subject(s) - wage , matching (statistics) , labour economics , wage dispersion , explanatory power , demographic economics , variation (astronomy) , economics , private sector , business , efficiency wage , economic growth , philosophy , physics , epistemology , astrophysics , statistics , mathematics
Using a micro-aggregated dataset that contains gross wages as well as employer and employee characteristics, we investigate whether observed wage differentials in Greece reflect mostly the underlying variation in employer characteristics, i.e. the structure of the Greek production, or worker and job characteristics. Our results show that both employer and worker characteristics are important contributors to the observed wage dispersion of full-time private sector jobs in Greece. Occupation and workplace effects alone explain around 52% of the overall wage variation in Greece. An additional 11% is explained by controlling for the impact of workplace-occupation matching. Other observable characteristics of the workers such as age, gender and type of job contract add up to 23.5% more explanatory power. Finally, our results also show that both the observed gender and contract type wage gaps are more prevalent among high-skilled occupations, acting thus as a disincentive to the acquisition of skills.