Exploring the Impact of Discrimination on the Gender Wage Gap

Abstract

The gender wage gap is a persistent issue that has been examined in several studies from different lenses, applying various approaches and statistical models. Numerous studies have widely investigated factors that are often assumed to contribute to the gender wage gap, such as education level, work hours, presence of children, and work experiences. While gender discrimination has been constricted, it still creates barriers for women to reach equal earning opportunities as men in the labor market. This study aims to shed light on the extent to which discrimination influences the wage gap by analyzing individuals’ labor force participation, age, gender, race, work experience, and educational attainment. To determine the discrimination component of the wage disparity, this study uses the Oaxaca-Blinder decomposition analysis. The results show a 37% difference in earnings between the two genders. Furthermore, the interaction component 0.8 % of the Oaxaca-Blinder decomposition indicates the presence of discrimination contributing to the wage disparity. These findings underscore the need for enhanced policies to ensure gender pay equality in the labor market.