The intra-firm gender wage gap: a new view on wage differentials based on linked employer-employee data

We provide a new view on the nature of the gender wage gap (GWG) by analyzing the wage differentials within establishments. Based on linked employer-employee data for Germany, we show that the GWGs vary tremendously across establishments, even if we assume that male and female employees have the same human capital characteristics within each establishment. This heterogeneity is linked to firm and institutional characteristics: For instance, firms with works council and those covered by collective wage agreements have smaller GWGs. Furthermore, we find some evidence that firms operating under strong product market competition behave in a more egalitarian way.