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A detailed decomposition analysis of the public-private sector wage gap in South Africa

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  • Prudence Kwenda
  • Miracle Ntuli

Abstract

The present study examines the public-private sector wage gap in South Africa using individual cross-sectional data for 2000–14. Results from unconditional quantile regressions and generalised Oaxaca–Blinder type decompositions show that the wage gap is an inverted-U shape across the wage distribution. The ‘composition effect’ is more important than the ‘price effect’ at the bottom of the distribution while the opposite applies at the top. Key factors underpinning the ‘composition effect’ are unionisation, industry of employment and education, while those associated with the ‘price effect’ are education, race and occupation.

Suggested Citation

  • Prudence Kwenda & Miracle Ntuli, 2018. "A detailed decomposition analysis of the public-private sector wage gap in South Africa," Development Southern Africa, Taylor & Francis Journals, vol. 35(6), pages 815-838, November.
    • Handle: RePEc:taf:deveza:v:35:y:2018:i:6:p:815-838
    DOI: 10.1080/0376835X.2018.1499501
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    Cited by:

    1. Livini Donath & Oliver Morrissey & Trudy Owens, 2021. "Pay period and the distributional effect of education on earnings: Evidence from recentered influence function," Discussion Papers 2021-02, University of Nottingham, CREDIT.
    2. Douglas Barrios & Federico Sturzenegger & Frank Muci & Patricio Goldstein & Ricardo Hausmann, 2022. "Macroeconomic risks after a decade of microeconomic turbulence: South Africa 2007-2020," CID Working Papers 404, Center for International Development at Harvard University.
    3. Andreas Wörgötter & Sihle Nomdebevana, 2019. "Aggregate and sectoral public-private remuneration patterns in South Africa," Working Papers 786, Economic Research Southern Africa.
    4. Ebenezer Lemven Wirba & Fiennasah Annif’ Akem & Francis Menjo Baye, 2021. "Earnings gap between men and women in the informal labor market in Cameroon," Review of Development Economics, Wiley Blackwell, vol. 25(3), pages 1466-1491, August.
    5. Naeem Akram, 2022. "Public-Private Wage Differentials: Evidence from Pakistan," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 27(2), pages 39-64, July-Dec.
    6. Eileen B. Nchanji & Odhiambo A. Collins & Enid Katungi & Agness Nduguru & Catherine Kabungo & Esther M. Njuguna & Chris O. Ojiewo, 2020. "What Does Gender Yield Gap Tell Us about Smallholder Farming in Developing Countries?," Sustainability, MDPI, vol. 13(1), pages 1-18, December.
    7. Douglas Barrios & Federico Sturzenegger & Frank Muci & Patricio Goldstein & Ricardo Hausmann, 2022. "Macroeconomic risks after a decade of microeconomic turbulence: South Africa 2007-2020," CID Working Papers 404, Center for International Development at Harvard University.
    8. Tansel, Aysit & Keskin, Halil Ibrahim & Ozdemir, Zeynel Abidin, 2020. "Public-private sector wage gap by gender in Egypt: Evidence from quantile regression on panel data, 1998–2018," World Development, Elsevier, vol. 135(C).

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