A Reexamination of Public-Sector Wage Differentials in the United States: Evidence from the NLSY with Geocode

While many researchers have sought to estimate federal‐private wage differentials in the United States, most of them ignore the issues of unobserved heterogeneity and selectivity among sectors. This article seeks to fill the gap in previous literature by using a more appropriate data set and several...

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Bibliographic Details
Published in:Industrial relations (Berkeley) 2004-04, Vol.43 (2), p.448-472
Main Author: Lee, Sang-Hyop
Format: Article
Language:English
Subjects:
Bias
Data analysis
Estimates
Gender differences
Industrial relations
Mathematical models
Private sector
Profit
Public sector
Statistical analysis
Studies
U.S.A
Wage differential
Wage differentials
Wages
Wages & salaries
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Summary:While many researchers have sought to estimate federal‐private wage differentials in the United States, most of them ignore the issues of unobserved heterogeneity and selectivity among sectors. This article seeks to fill the gap in previous literature by using a more appropriate data set and several compelling techniques. The main results suggest substantial bias in ordinary least squares (OLS) estimates of federal‐private wage differentials due to individual heterogeneity and self‐selection. The direction of bias under selectivity correction (upward for men and downward for women) is consistent with results from both test‐score approach estimates and the fixed‐effects estimates.
ISSN:0019-8676
1468-232X
DOI:10.1111/j.0019-8676.2004.00338.x