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  5. The Gender Pay Gap: Micro Sources and Macro Consequences

American Economic Review

ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)

The Gender Pay Gap: Micro Sources and Macro Consequences

  • Iacopo Morchio
  • Christian Moser
American Economic Review (Forthcoming)

Abstract

Using linked employer-employee data from Brazil, we document a significant gender pay gap, which is largely attributed to women working at lower-paying employers. To interpret this fact, we develop an equilibrium search model with endogenous firm pay, amenities, and hiring. We provide a constructive proof of identification of all model parameters. The estimated model suggests that amenities are important for both men and women, and that compensating differentials account for half of the gender pay gap. Equal-treatment policies partly close gender gaps but are not outputor welfare-improving.

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