Title
What Would the Average Public Sector Employee be Paid in the Private Sector?
Document Type
Journal Article
Publication Date
March 2008
Abstract
This paper estimates the average Australian public sector wage premium. It includes a detailed critical review of the methods available to address this issue. The chosen approach is a quasi‐differenced panel data model, estimated by the Generalised Method of Moments, which has many advantages over other methods and has not been used before for this topic. I find a positive average public sector wage premium for both sexes. The best estimates are 6.7% for men and 10.5% for women. The estimate is statistically significant for men (p = 0.024) and for women (p < 0.001). No evidence is found to suggest that the public sector has an equalising effect on the wages of its workers.
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Publication Details
This working paper was originally published as Siminski, P, What Would the Average Public Sector Employee be Paid in the Private Sector?, Working Paper 08-05, Department of Economics, University of Wollongong, 2008.