The influence of privatization on occupational wages

This paper uses individual worker and municipal information to examine privatization's influence on the wages of thirteen occupations. Findings reveal that the group of relatively low-skill content occupations comprising bus drivers and construction laborers receive a wage premium in the absence of privatization, and privatization is associated with an erosion of this premium. In contrast, the group of relatively high-skill content occupations comprising physicians and lawyers receive a non-trivial public sector discount in the absence of privatization and only the wage differential of physicians erodes with increased privatization. However, physician's public sector discount does not erode when estimating privatization's influence on this occupation's weekly earnings.