Swimming Upstream : Trends in the Gender Wage Differential in the 1980s

Using Michigan Panel Study of Income Dynamics data for 1979 and 1988, we analyze how a falling gender wage gap occurred despite changes in wage structure unfavorable to low wage workers. The decrease is traced to "gender-specific" factors which more than counterbalanced changes in measured and unmeasured prices working against women. Supply shifts net of demand were unfavorable for women generally and hurt high skilled more than middle and low skilled women. By analyzing wages, we find support for the notion of a gender twist in supply and demand having its largest negative effect on high skill women