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Public-Private Sector Wage Gap in Ghana: Single Spine Pay Policy to the Rescue?

Duodu, Albert LU (2019) NEKP01 20191
Department of Economics
Abstract
This paper exploits the adoption of Single Spine Pay Policy (SSPP) as a natural experiment to investigate the potency of wage policies in addressing the pay differentials between the public and private sector in Africa. The Government of Ghana in 2010, implemented the SSPP to tackle the long-standing wage gap between the public and private sector and consequently improve productivity in the public sector. Using a quantile treatment estimate of the difference-in-difference research design, I show that the SSPP has a heterogeneous impact in reducing the wage gap. I find that there is no substantial evidence that the public-private wage gap is reduced across the entire distribution on earnings in Ghana. By linking the analysis to... (More)
This paper exploits the adoption of Single Spine Pay Policy (SSPP) as a natural experiment to investigate the potency of wage policies in addressing the pay differentials between the public and private sector in Africa. The Government of Ghana in 2010, implemented the SSPP to tackle the long-standing wage gap between the public and private sector and consequently improve productivity in the public sector. Using a quantile treatment estimate of the difference-in-difference research design, I show that the SSPP has a heterogeneous impact in reducing the wage gap. I find that there is no substantial evidence that the public-private wage gap is reduced across the entire distribution on earnings in Ghana. By linking the analysis to productivity, I find that the implementation of the SSPP is yet to improve productivity. I particularly uncover evidence that the policy has a negative impact on effort for female workers in the public sector. (Less)
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author
Duodu, Albert LU
supervisor
organization
course
NEKP01 20191
year
type
H2 - Master's Degree (Two Years)
subject
keywords
Wage Policy, Wage-Gap, Quantile treatment effect, Difference-in-Difference
language
English
id
8981925
date added to LUP
2019-08-08 10:26:08
date last changed
2019-08-08 10:26:08
@misc{8981925,
  abstract     = {{This paper exploits the adoption of Single Spine Pay Policy (SSPP) as a natural experiment to investigate the potency of wage policies in addressing the pay differentials between the public and private sector in Africa. The Government of Ghana in 2010, implemented the SSPP to tackle the long-standing wage gap between the public and private sector and consequently improve productivity in the public sector. Using a quantile treatment estimate of the difference-in-difference research design, I show that the SSPP has a heterogeneous impact in reducing the wage gap. I find that there is no substantial evidence that the public-private wage gap is reduced across the entire distribution on earnings in Ghana. By linking the analysis to productivity, I find that the implementation of the SSPP is yet to improve productivity. I particularly uncover evidence that the policy has a negative impact on effort for female workers in the public sector.}},
  author       = {{Duodu, Albert}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{Public-Private Sector Wage Gap in Ghana: Single Spine Pay Policy to the Rescue?}},
  year         = {{2019}},
}