abstract

We employ a comprehensive linked employer-employee data set for Brazil to analyze wage determinants and compare results to Abowd, Kramarz, Margolis and Troske (2001) for French and U.S. manufacturing. While returns to human capital variables in Brazilian manufacturing exceed those of the other countries, occupation and gender differentials are similar. The worker characteristics component of individual compensation accounts for much of the greater wage inequality in Brazil, but the establishment-fixed component has scant explanatory power. Thus, firm- or industry-level factors have little scope for explaining the differences in wage inequality. Brazil's wage structure closely resembles that of France, a country with some similarity in labor-market institutions.

keywords: Wage structure; wage inequality; matched employer-employee data; formal and informal employment; selectivity; Brazil

jel: J31, D21

Review of Economics and Statistics 2008, 90(2): 324-46 [doi pdf]

background

• formal employment census RAIS (in portuguese)
• replication: stata 8.2 code
  • self-extracting file (maintaining directory structure) [zip 145k] (11/21/2006)
  • code is documented in, and self-executable on the original data through, the master program %OrderOfPrograms.do
• supporting files
  • additional tables and graphs [pdf 339k]
  • occupational concordances [pdf 232k]
  • matched firm data base (PIA) [summary] [pdf 490k]
  • data and resources for research on brazil