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Riska Dwi Wulandari
Faculty of Economics and Business, Brawijaya University, Indonesia
Economics, Econometrics & Finance

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Income Inequality between Formal-Informal Employees Based on Education Group Riska Dwi Wulandari; Susilo Susilo; Dias Satria
Economics and Finance in Indonesia Volume 64, Number 1, June 2018
Publisher : Institute for Economic and Social Research

Show Abstract | Download Original | Original Source | Check in Google Scholar | Full PDF (655.39 KB) | DOI: 10.47291/efi.v64i1.583

Abstract

Integrally, the informal sector deals with the formal sector with pro-cyclical nature or as a complementary sector. Such conditions allow for wage disparity between sectors even in the same education group. Thus, this study seeks to determine the determinants of wage inequality between formal and informal employees in skilled and unskilled workers in Indonesia in 2017 using Blinder-Oaxaca decomposition. The results showed that the discrimination factor had a greater influence than the endowment factor on wage inequality and the endowment factors that contributed to the increase in wage inequality between the two groups were age squared, experience, and job training.
Co-Authors Dias Satria Susilo Susilo