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The Gender Pay Gap: Micro Sources and Macro Consequences

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  • Iacopo Morchio
  • Christian Moser

Abstract

Using linked employer-employee data from Brazil, we document a large gender pay gap due 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 explain half of the gender pay gap. Equal-treatment policies partly close gender gaps but are not output- or welfare-improving.

Suggested Citation

  • Iacopo Morchio & Christian Moser, 2025. "The Gender Pay Gap: Micro Sources and Macro Consequences," CESifo Working Paper Series 11617, CESifo.
    • Handle: RePEc:ces:ceswps:_11617
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    References listed on IDEAS

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    More about this item

    Keywords

    wage inequality; amenities; equilibrium search model; linked employer-employee data; compensating differentials; taste-based discrimination; monopsony power;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions

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