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  5. Equal Pay for Similar Work

American Economic Review

ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)

Equal Pay for Similar Work

  • Diego Gentile Passaro
  • Fuhito Kojima
  • Bobak Pakzad-Hurson
American Economic Review (Forthcoming)

Abstract

Equal pay laws increasingly require that workers with different group identities doing “similar” work are paid equal wages within firm. We study such “equal pay for similar work” (EPSW) policies theoretically and test our models’ predictions empirically using evidence from a 2009 gender-based Chilean EPSW. Under EPSW, firms segregate their workforce by gender. When there are more men than women in a labor market, EPSW increases the gender wage gap.

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