Difference in the payoffs to productive characteristics

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Reference no: EM13984027

Wf = 2 + 0.2EDUC + 0.2EXP + 0.5TEN

Wm = 3 + 0.4EDUC + 0.3EXP + 0.5TEN

Where W is the hourly wage for men and females, EDUC is years of education, EXP is total years of experience, and TEN is tenure with ones current employer. Furthermore, the average female wage, Wf, is $10/hr, the average male wage, Wm, is $18/hr, the average EDUC for males is 15 years, the average EXP for males is 20 years, and the average TEN for males is 6 years.

What fraction of the gender wage gap is explained by differences in the production characteristics of men and women? What fraction of the gender wage gap is explained by difference in the payoffs to productive characteristics?

Reference no: EM13984027

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