Department of Economics

A QUANTILE REGRESSION ANALYSIS OF WAGES IN PANAMA

Department of Economics

University of Delaware

Working Paper #2004-01

A QUANTILE REGRESSION ANALYSIS OF WAGES IN PANAMA

Evangelos M. Falaris

ABSTRACT

I investigate differences in the effects of worker characteristics on wages in Panama at different points of the conditional wage distribution.   Public sector employment increases wages of men and of women relatively more at lower quantiles.  Public sector employment increases wages of the median worker in that sector and reduces wage inequality within the sector.  The existence of a labor union at a worker’s workplace increases relatively more wages of men at lower quantiles.   Labor unions reduce male wage inequality within the union sector and increase average wages of union members.  Unions do not increase women’s wages but reduce wage inequality within the union sector.  Working for a large firm increases wages relatively more at lower quantiles.   Rates of return to higher education and to experience are larger for men at higher quantiles.  Experience and higher education increase men’s wage inequality.  There are no differences across quantiles in rates of return to schooling and experience for women.

Keywords: wages, Panama, quantile regression

JEL classifications: J31, O15

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