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The B.E. Journal of Economic Analysis & Policy

Editor-in-Chief: Jürges, Hendrik / Ludwig, Sandra

Ed. by Auriol , Emmanuelle / Brunner, Johann / Fleck, Robert / Friebel, Guido / Requate, Till / Tsui, Kevin / Wichardt, Philipp / Zulehner, Christine

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A Distributional Analysis of the Gender Earnings Gap in Urban China

Daniel L Millimet1 / Le Wang2

1Southern Methodist University,

2Southern Methodist University,

Citation Information: Contributions in Economic Analysis & Policy. Volume 5, Issue 1, ISSN (Online) 1538-0645, DOI: 10.2202/1538-0645.1461, February 2006

Publication History

Published Online:
2006-02-14

Abstract

We compare several income distributions in urban China in the late 1980s and mid-1990s using tests for stochastic dominance in order to decompose gender differentials. Examination of the entire distribution gives insight into the uniformity of such differentials across the distribution. Moreover, tests based on stochastic dominance allow for robust welfare comparisons. Our analysis reveals: (i) large and increasing differentials in predicted earnings across gender in the lower tail of the distribution, but few differences in the upper tail, (ii) discrimination explains one-third to one-half of the total predicted earnings differential in the lower tail of the distribution, and little of the disparity in the upper tail, (iii) gender equity has eroded during China's economic transition, particularly for the youngest cohort, and (iv) significant nonuniformities in earnings differentials suggest the need to broaden analyses of gender differentials to incorporate earnings dispersion.

Keywords: discrimination; earnings distribution; stochastic dominance; decomposition; China; economic transition

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