Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/193395
Year of Publication: 
2019
Series/Report no.: 
IZA Discussion Papers No. 12101
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
Using Integrated Household Survey data from Georgia, we measure the observable and discriminatory ethnic wage gap, among male and female workers, and the gender wage gap, among Georgians and non-Georgians. The gender wage discrimination is larger than the ethnic wage discrimination. In the second estimation stage, these wage discrimination estimates are used in a general-to-specific vector autoregression framework to test for the Granger causality between discrimination and growth. A general, negative, bidirectional Granger causality is found between these two variables: in the long-run, discrimination reduces economic growth, and economic growth lowers discrimination. Also, we find that higher unemployment rates are associated with increased ethnic wage discrimination–in line with the predictions of Becker's theory of discrimination.
Subjects: 
labor market discrimination
transition economies
growth
granger causality
JEL: 
J71
O43
J15
J16
Document Type: 
Working Paper

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