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The Agricultural Wage Gap: Evidence from Brazilian Micro-data

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  • Jorge A. Alvarez

Abstract

A key feature of developing economies is that wages in agriculture are below those of other sectors. Using Brazilian household surveys and administrative panel data, I use information on workers who switch sectors and workers with multiple jobs to assess the role of worker composition in explaining this gap. The evidence is consistent with the presence of significant intersector sorting in Brazil. A calibrated sorting model can account for the wage gap level observed, as well as its decline, as the economy transitioned out of agriculture.

Suggested Citation

  • Jorge A. Alvarez, 2020. "The Agricultural Wage Gap: Evidence from Brazilian Micro-data," American Economic Journal: Macroeconomics, American Economic Association, vol. 12(1), pages 153-173, January.
    • Handle: RePEc:aea:aejmac:v:12:y:2020:i:1:p:153-73
    DOI: 10.1257/mac.20170436
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    Cited by:

    1. Lagakos, David & Marshall, Samuel & Mobarak, Ahmed Mushfiq & Vernot, Corey & Waugh, Michael E., 2020. "Migration costs and observational returns to migration in the developing world," Journal of Monetary Economics, Elsevier, vol. 113(C), pages 138-154.
    2. Merfeld, Joshua D., 2021. "Sectoral Wage Gaps and Gender in Rural India," IZA Discussion Papers 14391, Institute of Labor Economics (IZA).
    3. Baysan, Ceren & Dar, Manzoor H. & Emerick, Kyle & Li, Zhimin & Sadoulet, Elisabeth, 2024. "The agricultural wage gap within rural villages," Journal of Development Economics, Elsevier, vol. 168(C).
    4. Tasso Adam & Loren Brandt & Chaoran Chen & Diego Restuccia & Xiaoyun Wei, 2024. "Land Security and Mobility Frictions," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 139(3), pages 1941-1987.
    5. Niklas Engbom & Gustavo Gonzaga & Christian Moser & Roberta Olivieri, 2022. "Earnings inequality and dynamics in the presence of informality: The case of Brazil," Quantitative Economics, Econometric Society, vol. 13(4), pages 1405-1446, November.
    6. Fang Song & Xuerong Xu, 2023. "How Operation Scale Improve the Production Technical Efficiency of Grape Growers? An Empirical Evidence of Novel Panel Methods for China’s Survey Data," Sustainability, MDPI, vol. 15(4), pages 1-19, February.
    7. Porzio, Tommaso & Rossi, Federico & Santangelo, Gabriella, 2020. "The Human Side of Structural Transformation," CEPR Discussion Papers 15110, C.E.P.R. Discussion Papers.
    8. Selod, Harris & Shilpi, Forhad, 2021. "Rural-urban migration in developing countries: Lessons from the literature," Regional Science and Urban Economics, Elsevier, vol. 91(C).
    9. Schoellman, Todd, 2020. "Comment on “migration costs and observational returns to migration in the developing world”," Journal of Monetary Economics, Elsevier, vol. 113(C), pages 155-157.
    10. Barker, Nathan & Davis, C. Austin & López-Peña, Paula & Mitchell, Harrison & Mobarak, Ahmed Mushfiq & Naguib, Karim & Reimão, Maira Emy & Shenoy, Ashish & Vernot, Corey, 2023. "Migration and resilience during a global crisis," European Economic Review, Elsevier, vol. 158(C).
    11. Tushar Bharati & Adnan M. S. Fakir & Wina Yoman, 2024. "Internal Migration and Labor Market Outcomes in Indonesia," Economic Development and Cultural Change, University of Chicago Press, vol. 72(2), pages 997-1040.
    12. Imbert, Clément & Papp, John, 2020. "Costs and benefits of rural-urban migration: Evidence from India," Journal of Development Economics, Elsevier, vol. 146(C).
    13. Hang, Jing, 2020. "The gross output agricultural productivity gap," Economics Letters, Elsevier, vol. 191(C).
    14. Qingen Gai & Naijia Guo & Bingjing Li & Qinghua Shi & Xiaodong Zhu, 2021. "Migration Costs, Sorting, and the Agricultural Productivity Gap," Working Papers tecipa-693, University of Toronto, Department of Economics.
    15. Joshua D. Merfeld, 2023. "Sectoral wage gaps and gender in rural India†," American Journal of Agricultural Economics, John Wiley & Sons, vol. 105(2), pages 434-452, March.

    More about this item

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J43 - Labor and Demographic Economics - - Particular Labor Markets - - - Agricultural Labor Markets
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q10 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - General

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