Urban Attributes and Wage Disparities in Brazil: A Multilevel Hierarchical Model

Fontes G. G., Simoes R. F. and Hermeto Camilo de Oliveira A. M. Urban attributes and wage disparities in Brazil: a multilevel hierarchical model, Regional Studies. This paper examines the effects of urban scale and productive structure on individual wage levels in Brazilian cities and metropolitan areas in 1990 and 2000. The estimation through hierarchical linear models enabled the inclusion of variables in different levels (individual and urban) and the decomposition of total wage variance. The results showed significant and huge wage disparities among workers who share similar personal attributes but live in different regions of the country. In addition, the disparities persisted from 1990 to 2000. Finally, the results provided evidence that local economic and labour market factors played an important role in wage determination.