Interindustry wage differentials in dummy variable models

Normalized interindustry wage differentials à la Krueger and Summers [Krueger, A.B., Summers, L.H., 1988. Efficiency wages and the inter-industry wage structure. Econometrica 56, 259–293] derive from a general specification of wage equations with dummy variables which cannot be directly estimated. T...

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Bibliographic Details
Published in:Economics letters 1998-09, Vol.60 (3), p.297-301
Main Author: Zanchi, Luisa
Format: Article
Language:English
Subjects:
Dummy variables
Econometrics
Human resources
Interindustry wage differentials
Variance
Wage differentials
Wage structure
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Summary:Normalized interindustry wage differentials à la Krueger and Summers [Krueger, A.B., Summers, L.H., 1988. Efficiency wages and the inter-industry wage structure. Econometrica 56, 259–293] derive from a general specification of wage equations with dummy variables which cannot be directly estimated. This note illustrates how they can be obtained from the coefficients of a more specific parameterization and how their estimated variances can be transformed accordingly.
ISSN:0165-1765
1873-7374
DOI:10.1016/S0165-1765(98)00120-7