Wages, education and gender discrimination. An empirical investigation

Abstract

One of the most important factors of economic growth and development is human capital. Investing in education, we achieve an improvement in productivity, skills and quality of life. Education plays a very important role in the social and economic development of a country. All the characteristics that we obtain by investing in education form the human capital, which lead us to increase the production of the company and consequently, to increase the benefit for the individual. Using data from the OECD's International Adult Competencies Program (PIAAC), we have made an empirical study measuring the returns to education and the existence of wage discrimination against women in Spain. From the regression of Spain, we have made the same regression for other European countries allowing an international comparison. The results of our econometric analysis show that there is a strong positive relationship between salaries and years of education, being significant in all the countries analyzed. The estimated returns to education move in a range of values of 3.4% (percent). Our regression shows that women's wages are significantly lower than men's in five countries (Poland, Finland, France, Belgium and Spain). We also detect in other countries, such as France and Denmark, another type of discrimination so that the returns to education are lower for women, penalizing more severely the women with higher levels of education.