THE DISTRIBUTION OF MALE AND FEMALE EARNINGS 1973-91 - EVIDENCE FOR BRITAIN

This paper analyses the major developments in the structure of male an d female pay in Britain between 1973 and 1991. These are the narrowing of the gender pay gap and the increasing inequality of male and femal e earnings. The first innovation is decomposing the changing gender pa y gap into three components: prices, characteristics, and unmeasured ( residual) effects at any percentile level of interest to the investiga tor. An important role for prices in narrowing the gender gap is found and the second innovation is a method to identify which prices are cr itical. Qualifications turn out to be the key factor.