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Assessment of Labour Market Returns to Gender Unique Human Capital: Evidence from Estonia

Author

Listed:
  • Maryna Tverdostup

    (University of Tartu (Estonia))

  • Tiiu Paas

    (University of Tartu (Estonia))

Abstract

Relying on the Survey of Adult Skills (PIAAC) data for Estonia as quickly developing economy with high rate of women’s labour participation, we raise a research from a novel perspective towards human capital role in gender wage gap. Instead of usual reference to the observable male-female characteristics’ differences, we identify the gender-unique, non-reached by the opposite gender human capital and analyse its effect on the earning profiles. The results show that men’ and women’ average characteristics cannot be directly compared, as particular features are exclusive for certain gender. We find that combination of high cognitive abilities in numeracy and problem solving in technology-rich environment domains is often attributed to men solely. It constitutes the main component of male-unique human capital, being a strong and highly rewarded competitive advantage on a labor market. Ignoring this notion leads to overestimation of discriminatory labor market effects and thus imprecise wage inequality estimation.

Suggested Citation

  • Maryna Tverdostup & Tiiu Paas, 2016. "Assessment of Labour Market Returns to Gender Unique Human Capital: Evidence from Estonia," Gecomplexity Discussion Paper Series 201605, Action IS1104 "The EU in the new complex geography of economic systems: models, tools and policy evaluation", revised Apr 2016.
    • Handle: RePEc:cst:wpaper:201605
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    File URL: http://www.gecomplexity-cost.eu/repec/cst/wpaper/geco_dp_5_2016.pdf
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    More about this item

    Keywords

    human capital; gender wage gap; PIAAC; non-parametric decomposition; Estonia;
    All these keywords.

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • 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
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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