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Original Articles

Inter-Regional Wage Differentials in Portugal: An Analysis Across the Wage Distribution

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Pages 1529-1546 | Received 04 Nov 2011, Accepted 26 Oct 2012, Published online: 15 Jan 2013
 

Abstract

Pereira J. and Galego A. Inter-regional wage differentials in Portugal: an analysis across the wage distribution, Regional Studies. Typically, studies on regional wage differentials are based on ordinary least squares (OLS) estimates. Quantile regression is an alternative approach which allows these differences to be studied across the whole wage distribution. In this study, the quantile regression framework is considered for the analysis of regional wage differences in Portugal. The findings reveal significant differences in wage equations coefficients between regions for the various quantiles. Furthermore, it is concluded that the regional wage differentials and the components explained by differences in endowments and differences in returns increase across the whole wage distribution.

Pereira J. and Galego A. 葡萄牙的跨区域薪资差异:薪资分布的分析研究,区域研究。一般而言,区域薪资差异的研究是以普通最小二乘法(OLS)为基础。分位数回归则是可以横跨整体薪资分布进行差异研究的替代方法。本研究运用分位数回归框架,分析葡萄牙的区域薪资差异。研究发现,区域间的薪资方程系数之于不同的分位数具有显著差异。此外,结论部分本文主张,区域薪资差异以及透过天赋因素差异和回收差异所解释的组成,在全体薪资分布方面皆有所增加。

Pereira J. et Galego A. Les écarts de salaires interrégionaux au Portugal: une analayse à travers la distribution des salaires, Regional Studies. Généralement les études des écarts de salaires régionaux reposent sur des estimations par la méthode des moindres carrés ordinaires (MCO). Une autre approche c'est la régression quantile qui permet d'étudier ces écarts à travers toute la distribution des salaires. La présente étude tient compte de la régression quantile pour analyser les écarts de salaires régionaux au Portugal. Les résultats laissent voir d'importantes différences des coefficients des équations des salaires entre les régions pour les divers quantiles. Qui plus est, on conclut que les écarts de salaires régionaux et les composantes qui s'expliquent par des différences des dotations de facteurs et des rendements se creusent à travers toute la distribution des salaires.

Pereira J. und Galego A. Interregionale Lohndifferenziale in Portugal: eine Analyse im gesamten Lohnspektrum, Regional Studies. In der Regel basieren Studien über regionale Lohndifferenziale auf Schätzungen nach der Methode der kleinsten Quadrate (OLS). Ein alternativer Ansatz ist die quantile Regression, die eine Untersuchung dieser Differenziale für das gesamte Lohnspektrum ermöglicht. In dieser Studie wird der Rahmen der quantilen Regression als Methode zur Analyse der regionalen Lohndifferenziale in Portugal untersucht. Die Ergebnisse verdeutlichen signifikante Unterschiede zwischen den Regionen hinsichtlich der Lohngleichungskoeffizienten für die verschiedenen Quantile. Darüber hinaus wird der Schluss gezogen, dass die regionalen Lohndifferenziale und die durch Unterschiede in puncto Ausstattung und Ertrag bedingten Komponenten über das gesamte Lohnspektrum hinweg zunehmen.

Pereira J. y Galego A. Diferencias interregionales de salarios en Portugal: un análisis en toda la distribución salarial, Regional Studies. Normalmente los estudios sobre las diferencias regionales de salarios se basan en estimaciones por mínimos cuadrados ordinarios. Un planteamiento alternativo es la regresión cuantílica que permite estudiar estas diferencias en toda la distribución salarial. En este estudio, consideramos la estructura de regresión cuantílica para el análisis de las diferencias regionales de salarios en Portugal. Los resultados indican diferencias significativas entre las regiones en cuanto a los coeficientes de ecuaciones de salarios para los diferentes cuantiles. Además, concluimos que las diferencias regionales de salarios y los componentes explicados por diferencias en dotaciones y diferencias en las devoluciones aumentan en toda la distribución salarial.

JEL classifications:

Acknowledgements

The authors would like to thank two anonymous referees for their helpful comments and suggestions. The authors are pleased to acknowledge financial support from the Fundação para a Ciência e a Tecnologia and FEDER/COMPETE (Grant Number PEst-C/EGE/UI4007/2011) and permission to access the dataset provided by the Ministry of Employment – Quadros de Pessoal.

Notes

1. These regions are made up of islands and therefore present a quite different situation to those located on mainland Portugal.

2. For both men and women, the null hypothesis that the populations are the same is rejected at any significance level below 1%.

3. For a definition of variables, see in Appendix A.

4. Other possible parametric or semi-parametric methods to take into account selectivity also need this type of information. For a survey about different methods to estimate models with selection bias, see Vella Citation(1998).

5. As in Pereira and Galego Citation(2011).

6. In Organisation for Economic Co-operation and Development (OECD) (Citation2000) Portugal is referred to as a country with one of the lowest rates of internal mobility in Europe.

7. Exceptions are the coefficient estimates for exp, exp2 and tenure2, for women in Alentejo and the Algarve, which are not significant for the lowest quantile. The complete results are available from the authors upon request.

8. Due to the large amount of results involved, these are not present. However, the results are available from the authors upon request.

9. Albrecht et al. Citation(2003) carried out their calculations using J = 100 in a slightly different version of the Machado and Mata Citation(2005) estimator.

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