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Is There a Gap in the Gap? Regional Differences in the Gender Pay Gap

Author

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  • Hirsch, Boris

    (Leuphana University Lüneburg)

  • König, Marion

    (Institute for Employment Research (IAB), Nuremberg)

  • Möller, Joachim

    (Institute for Employment Research (IAB), Nuremberg)

Abstract

In this paper, we investigate regional differences in the gender pay gap both theoretically and empirically. Within a spatial oligopsony model, we show that more densely populated labour markets are more competitive and constrain employers' ability to discriminate against women. Utilising a large administrative data set for western Germany and a flexible semi-parametric propensity score matching approach, we find that the unexplained gender pay gap for young workers is substantially lower in large metropolitan than in rural areas. This regional gap in the gap of roughly ten percentage points remained surprisingly constant over the entire observation period of thirty years.

Suggested Citation

  • Hirsch, Boris & König, Marion & Möller, Joachim, 2009. "Is There a Gap in the Gap? Regional Differences in the Gender Pay Gap," IZA Discussion Papers 4231, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp4231
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    More about this item

    Keywords

    matching; urban-rural differences; gender pay gap; monopsonistic discrimination;
    All these keywords.

    JEL classification:

    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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