The deserved wage?

Time: 2011, Tuesday April 19, 13.00-14.00 hours
Location: CPB-office, Van Stolkweg 14, The Hague

Presentation: Ernest Berkhout (SEO)

Discussant: Anja Deelen (CPB)

Language: English

Registration:  Please register by sending an email to seminars@cpb.nl.

Abstract subject: Average collective wage development in the public sector is supposed to follow the development of private contractual wages (the so-called ‘referentiemodel’). However, the individual wage component is often higher and more unevenly distributed in the private sector. As a consequence, high skilled public employees faced a wage growth of only 39% in the 1996-2005 period, compared to 58% for their private counterparts.
In a propensity score matching model, public sector employees are not only matched to private sector ‘comparable employees’ by standard wage determinants (like experience and educational level) but also to comparable jobs defined by education field and job type. This model extension explains
part of the results. The characteristics of the average public sector employee had a relatively low ‘market value’ in 1996, making the public sector the most attractive in terms of wages. By 2005 the market sector had closed this pay gap, offering comparable wages to comparable employees in comparable jobs.

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