Higher Wages, Lower Pay : Public vs. Private Sector Compensation in Peru
Do public sector employees earn less than their counterparts in the private sector? This paper addresses this question in the case of Peru, a country where civil service reform is being debated yet the only available empirical studies on wage diffe...
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| Format: | Policy Research Working Paper |
| Language: | English |
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2012
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| Online Access: | http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20111026082814 http://hdl.handle.net/10986/3624 |
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okr-10986-36242021-04-23T14:02:11Z Higher Wages, Lower Pay : Public vs. Private Sector Compensation in Peru Coppola, Andrea Calvo-Gonzalez, Oscar AVERAGE EDUCATION LEVEL CITIES CUMULATIVE DISTRIBUTION FUNCTION DATA SET DEPENDENT VARIABLE DESCRIPTIVE STATISTICS DRIVERS EARNING ECONOMETRIC ANALYSIS ECONOMIC POLICY ECONOMIC REVIEW EDUCATION LEVELS EMPIRICAL ANALYSIS EMPIRICAL EVIDENCE EMPIRICAL STUDIES EMPLOYEE EMPLOYMENT EXPLANATORY POWER EXPLANATORY VARIABLE EXPLANATORY VARIABLES FIRING COSTS HOUSEHOLD DATA HOUSEHOLD SURVEY HUMAN CAPITAL HUMAN RESOURCES JOB SECURITY LABOR ECONOMICS LABOR FORCE LABOR FORCE PARTICIPATION LABOR MARKET LABOR MARKET DISCRIMINATION LABOR MARKETS LEVEL OF EDUCATION LEVELS OF EDUCATION LINEAR REGRESSION NO-SHIRKING CONSTRAINT POLICY DISCUSSIONS POLICY RESEARCH POLITICAL ECONOMY POSITIVE EFFECT POSITIVE IMPACT POSTGRADUATE EDUCATION PRELIMINARY ANALYSIS PREVIOUS SECTION PRIMARY EDUCATION PRIVATE SECTOR PRIVATE SECTOR EMPLOYEE PRIVATE SECTOR EMPLOYEES PRIVATE SECTOR JOB PRIVATE SECTOR PUBLIC PRIVATE SECTOR WAGE PRIVATE SECTOR WAGES PRIVATE SECTOR WORKERS PRIVATE SECTORS PROBIT EQUATION PROBIT EQUATIONS PUBLIC ADMINISTRATION PUBLIC EXPENDITURES PUBLIC SECTOR PUBLIC SECTOR COMPENSATION PUBLIC SECTOR EMPLOYEE PUBLIC SECTOR EMPLOYEES PUBLIC SECTOR EMPLOYMENT PUBLIC SECTOR JOB PUBLIC SECTOR PAY PUBLIC SECTOR WAGE PUBLIC SECTOR WAGES PUBLIC SECTOR WORKERS PUBLIC SECTORS REGRESSION ANALYSIS RETIREMENT SERVANTS SKILLED WORKERS URBAN AREAS URBAN WORKERS WAGE BILL WAGE COMPRESSION WAGE DATA WAGE DIFFERENTIAL WAGE DIFFERENTIALS WAGE DISTRIBUTION WAGE LEVELS WAGE PREMIUM WAGE RATES WORKER WORKERS WORKING EXPERIENCE Do public sector employees earn less than their counterparts in the private sector? This paper addresses this question in the case of Peru, a country where civil service reform is being debated yet the only available empirical studies on wage differentials date back to the late 1980s. Using data from the 2009 national household survey, the authors perform a multiple step analysis. First, they estimate a single equation with a public sector dummy, which is found to be statistically significant and positive when only monetary wages are taken into account. However, when in-kind payments and bonuses are included to measure compensation, the analysis finds a private sector premium. Second, they estimate for public and formal private employees two distinct wage functions, including the inverse Mills ratio. This takes into account the selection bias resulting from workers self-selecting into the public or private sector. Third, these results are used to decompose wage differentials using the standard Oaxaca-Blinder approach. The results show that the compensation differentials are not significant except for the sub-sample of employees that achieved a postgraduate degree. 2012-03-19T18:05:46Z 2012-03-19T18:05:46Z 2011-10-01 http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20111026082814 http://hdl.handle.net/10986/3624 English Policy Research working paper ; no. WPS 5858 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Publications & Research :: Policy Research Working Paper Latin America & Caribbean Latin America & Caribbean South America America Peru |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
AVERAGE EDUCATION LEVEL CITIES CUMULATIVE DISTRIBUTION FUNCTION DATA SET DEPENDENT VARIABLE DESCRIPTIVE STATISTICS DRIVERS EARNING ECONOMETRIC ANALYSIS ECONOMIC POLICY ECONOMIC REVIEW EDUCATION LEVELS EMPIRICAL ANALYSIS EMPIRICAL EVIDENCE EMPIRICAL STUDIES EMPLOYEE EMPLOYMENT EXPLANATORY POWER EXPLANATORY VARIABLE EXPLANATORY VARIABLES FIRING COSTS HOUSEHOLD DATA HOUSEHOLD SURVEY HUMAN CAPITAL HUMAN RESOURCES JOB SECURITY LABOR ECONOMICS LABOR FORCE LABOR FORCE PARTICIPATION LABOR MARKET LABOR MARKET DISCRIMINATION LABOR MARKETS LEVEL OF EDUCATION LEVELS OF EDUCATION LINEAR REGRESSION NO-SHIRKING CONSTRAINT POLICY DISCUSSIONS POLICY RESEARCH POLITICAL ECONOMY POSITIVE EFFECT POSITIVE IMPACT POSTGRADUATE EDUCATION PRELIMINARY ANALYSIS PREVIOUS SECTION PRIMARY EDUCATION PRIVATE SECTOR PRIVATE SECTOR EMPLOYEE PRIVATE SECTOR EMPLOYEES PRIVATE SECTOR JOB PRIVATE SECTOR PUBLIC PRIVATE SECTOR WAGE PRIVATE SECTOR WAGES PRIVATE SECTOR WORKERS PRIVATE SECTORS PROBIT EQUATION PROBIT EQUATIONS PUBLIC ADMINISTRATION PUBLIC EXPENDITURES PUBLIC SECTOR PUBLIC SECTOR COMPENSATION PUBLIC SECTOR EMPLOYEE PUBLIC SECTOR EMPLOYEES PUBLIC SECTOR EMPLOYMENT PUBLIC SECTOR JOB PUBLIC SECTOR PAY PUBLIC SECTOR WAGE PUBLIC SECTOR WAGES PUBLIC SECTOR WORKERS PUBLIC SECTORS REGRESSION ANALYSIS RETIREMENT SERVANTS SKILLED WORKERS URBAN AREAS URBAN WORKERS WAGE BILL WAGE COMPRESSION WAGE DATA WAGE DIFFERENTIAL WAGE DIFFERENTIALS WAGE DISTRIBUTION WAGE LEVELS WAGE PREMIUM WAGE RATES WORKER WORKERS WORKING EXPERIENCE |
| spellingShingle |
AVERAGE EDUCATION LEVEL CITIES CUMULATIVE DISTRIBUTION FUNCTION DATA SET DEPENDENT VARIABLE DESCRIPTIVE STATISTICS DRIVERS EARNING ECONOMETRIC ANALYSIS ECONOMIC POLICY ECONOMIC REVIEW EDUCATION LEVELS EMPIRICAL ANALYSIS EMPIRICAL EVIDENCE EMPIRICAL STUDIES EMPLOYEE EMPLOYMENT EXPLANATORY POWER EXPLANATORY VARIABLE EXPLANATORY VARIABLES FIRING COSTS HOUSEHOLD DATA HOUSEHOLD SURVEY HUMAN CAPITAL HUMAN RESOURCES JOB SECURITY LABOR ECONOMICS LABOR FORCE LABOR FORCE PARTICIPATION LABOR MARKET LABOR MARKET DISCRIMINATION LABOR MARKETS LEVEL OF EDUCATION LEVELS OF EDUCATION LINEAR REGRESSION NO-SHIRKING CONSTRAINT POLICY DISCUSSIONS POLICY RESEARCH POLITICAL ECONOMY POSITIVE EFFECT POSITIVE IMPACT POSTGRADUATE EDUCATION PRELIMINARY ANALYSIS PREVIOUS SECTION PRIMARY EDUCATION PRIVATE SECTOR PRIVATE SECTOR EMPLOYEE PRIVATE SECTOR EMPLOYEES PRIVATE SECTOR JOB PRIVATE SECTOR PUBLIC PRIVATE SECTOR WAGE PRIVATE SECTOR WAGES PRIVATE SECTOR WORKERS PRIVATE SECTORS PROBIT EQUATION PROBIT EQUATIONS PUBLIC ADMINISTRATION PUBLIC EXPENDITURES PUBLIC SECTOR PUBLIC SECTOR COMPENSATION PUBLIC SECTOR EMPLOYEE PUBLIC SECTOR EMPLOYEES PUBLIC SECTOR EMPLOYMENT PUBLIC SECTOR JOB PUBLIC SECTOR PAY PUBLIC SECTOR WAGE PUBLIC SECTOR WAGES PUBLIC SECTOR WORKERS PUBLIC SECTORS REGRESSION ANALYSIS RETIREMENT SERVANTS SKILLED WORKERS URBAN AREAS URBAN WORKERS WAGE BILL WAGE COMPRESSION WAGE DATA WAGE DIFFERENTIAL WAGE DIFFERENTIALS WAGE DISTRIBUTION WAGE LEVELS WAGE PREMIUM WAGE RATES WORKER WORKERS WORKING EXPERIENCE Coppola, Andrea Calvo-Gonzalez, Oscar Higher Wages, Lower Pay : Public vs. Private Sector Compensation in Peru |
| geographic_facet |
Latin America & Caribbean Latin America & Caribbean South America America Peru |
| relation |
Policy Research working paper ; no. WPS 5858 |
| description |
Do public sector employees earn less
than their counterparts in the private sector? This paper
addresses this question in the case of Peru, a country where
civil service reform is being debated yet the only available
empirical studies on wage differentials date back to the
late 1980s. Using data from the 2009 national household
survey, the authors perform a multiple step analysis. First,
they estimate a single equation with a public sector dummy,
which is found to be statistically significant and positive
when only monetary wages are taken into account. However,
when in-kind payments and bonuses are included to measure
compensation, the analysis finds a private sector premium.
Second, they estimate for public and formal private
employees two distinct wage functions, including the inverse
Mills ratio. This takes into account the selection bias
resulting from workers self-selecting into the public or
private sector. Third, these results are used to decompose
wage differentials using the standard Oaxaca-Blinder
approach. The results show that the compensation
differentials are not significant except for the sub-sample
of employees that achieved a postgraduate degree. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Coppola, Andrea Calvo-Gonzalez, Oscar |
| author_facet |
Coppola, Andrea Calvo-Gonzalez, Oscar |
| author_sort |
Coppola, Andrea |
| title |
Higher Wages, Lower Pay : Public vs. Private Sector Compensation in Peru |
| title_short |
Higher Wages, Lower Pay : Public vs. Private Sector Compensation in Peru |
| title_full |
Higher Wages, Lower Pay : Public vs. Private Sector Compensation in Peru |
| title_fullStr |
Higher Wages, Lower Pay : Public vs. Private Sector Compensation in Peru |
| title_full_unstemmed |
Higher Wages, Lower Pay : Public vs. Private Sector Compensation in Peru |
| title_sort |
higher wages, lower pay : public vs. private sector compensation in peru |
| publishDate |
2012 |
| url |
http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20111026082814 http://hdl.handle.net/10986/3624 |
| _version_ |
1764387492775067648 |