Decomposing the gender pay gap in the formal sector in Venezuela: a microdata analysis 1985–2015

ABSTRACT

This note explores the presence of a gender pay gap in Venezuela. Using household surveys between 1985 and 2015, I test for gender disparity on wages in the formal sector. Firstly, I use a dummy variable technique in Ordinary Least Squares regression and quantile regressions. Secondly, I apply a two-fold decomposition approach following Blinder-Oaxaca, Cotton, and pooled model assumptions. Finally, I decompose the differences in distribution using quantile regressions. The main finding suggests a significant gender pay gap. On average, women earn about 21% less than men, and this inequality is more evident in 2015 for low quantiles.

KEYWORDS:

• Decomposition
• disparity
• formal sector
• gender
• pay gap
• Venezuela

JEL CLASSIFICATION:

• J31
• J53
• J71

Disclosure statement

No potential conflict of interest was reported by the author.

Correction Statement

This article has been republished with minor changes. These changes do not impact the academic content of the article.

Notes

¹ For background, Bishu and Alkadry (2017) review 98 journal articles on this topic.

² Bando (2019) is a recent effort to identify individual, societal, technological, and institutional factors that might have influenced the gender pay inequality over the last ten years in Latin America.

³ See Appendix for details about the methodologies.

⁴ Given changes in the survey’s dictionary, as in 1994, a harmonized process was performed.

⁵ Looking for robustness, I run the regressions under different combinations of covariates, reaching similar results. Table 2 shows the complete form.

⁶ Standard errors were computed by bootstrapping the results 100 times.