Quantile Regression Analysis of Wage Inequality in West-African Countries

Abstract

In this paper, we investigate the determinants of wage differences in West Africa while dealing with the problem of sample selection in occupational choice. Using data from Household Living Conditions Surveys from six west-African countries, namely Senegal, Mali, Togo, Benin, Burkina Faso and Niger between 2010 and 2018, we estimate Heckman's two-stage model with non-linear quantile regression to assess the effect of individual characteristics on wage rates. After correcting for the sample selection effect, we find that education, experience, marital status, and gender are the major determinants of wage in west-African countries. Subsequently, we apply the Oaxaca decomposition, and the results suggest the presence of wage inequity that is not explained by the observable characteristics between women and men. This gender difference plausibly reflects the persistence of the discrimination against women in the labor market in west-African countries.