The Public/Private Wage Differential in the Land of Gross National Happiness
In Bhutan, the public sector is usually seen as the most desirable employer. This study asks if this can be attributed to public sector employees receiving higher wages than comparable private sector workers. To answer the question, the study combi...
| Main Author: | |
|---|---|
| Format: | Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2017
|
| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/557301482173775864/The-public-private-wage-differential-in-the-land-of-gross-national-happiness http://hdl.handle.net/10986/25828 |
| Summary: | In Bhutan, the public sector is usually
seen as the most desirable employer. This study asks if this
can be attributed to public sector employees receiving
higher wages than comparable private sector workers. To
answer the question, the study combines an Oaxaca-type
decomposition of wage differentials into characteristics and
coefficients effects with a multinomial logit model for
self-selection into labor force participation and the public
or private sector. The study finds that the public/private
wage differential is sizeable but can entirely be accounted
for by observable characteristics. At the same time, there
is strong evidence that preferences for public sector jobs
are caused by pronounced intersectoral differences in
overall compensation packages, in particular fringe benefits. |
|---|