Sources of Gender Differentials in Labor Market Outcomes for Low-Skilled Workers : Evidence from Indonesia

To understand gender inequalities in labor market outcomes of seemingly homogeneous low-skilled workers in developing countries, we build and estimate a search model of the labor market in which agents decide their labor market participation, employment type, and migration status. The model parameters are estimated using the Indonesia Family Life Survey (IFLS) from RAND. Our estimates enable the study of multiple channels contributing to the gender wage gap: frequent migration, temporary work, and non-labor market participation. Policy experiments show that when more female workers migrate to cities or work in permanent jobs, gender wage differentials become narrower