Regional Wage Gaps, Education and Informality in an Emerging Country: The Case of Colombia. Issue 4 (1st October 2016)

• Record Type: Journal Article
• Authors: Herrera-Idárraga, Paula; López-Bazo, Enrique; Motellón, Elisabet
• Is Part Of: Spatial economic analysis. Volume 11:Issue 4(2016)
• Page Start: 432
• Page End: 456
• Publication Date: 2016-10-01
• Subjects: Wage differentials -- quantile-based decompositions -- informal jobs -- economic development; C21 -- J31 -- O17 -- R23; Space in economics -- Periodicals; Economic geography -- Periodicals; Space in economics -- Econometric models -- Periodicals; Urbanization -- Periodicals; Espace (Économie politique) -- Périodiques; Économétrie -- Périodiques; Géographie économique -- Périodiques; Économie industrielle -- Périodiques; Économie du travail -- Périodiques; Économie urbaine -- Périodiques; Politique économique -- Périodiques; Relations économiques internationales -- Périodiques; 330.9
• DOI: 10.1080/17421772.2016.1190462
• Languages: English
• ISSNs: 1742-1772

Abstract

Abstract: This paper uses Colombian micro-data to analyze the role of education and informality in regional wage differentials. The hypothesis is that apart from differences in the endowment of human capital, regional heterogeneity in the incidence of informality is another important source of regional wage inequality in emerging countries. This is confirmed by the evidence from Colombia, which also reveals remarkable spatial heterogeneity in the wage return to individuals' characteristics. Regional heterogeneity in returns to education is especially intense in the upper part of the wage distribution. In turn, heterogeneity in the informal pay penalty is more relevant at the bottom.