Gender Earnings' Differentials: Dissagregating Human Capital Characteristics
Elia De la Cruz Toledo, Columbia University
I establish that including a more precise measure of work experience and measures of cognitive ability and non-cognitive traits increases the percentage attributed to endowments in the estimation of the gender gap in weekly wages in Mexico. Results show a gender gap of 15% in weekly wages. A quarter of this gap is explained by gender differences in endowments. Another quarter is explained by differentiated returns to employees' characteristics, while half of the gap remains unexplained. The inclusion of the additional measures of human capital increases the share attributable to endowments by eight percentage points, and decreases the share attributable to returns by ten percentage points. The share of endowments explained by human capital increases by fivefold once work experience and cognitive and non-cognitive traits are accounted. Prior studies on gender wage differentials have found a similar gap, but failed to disaggregate the contribution of the different human capital characteristics.