How Welfare States Shape the Gender Pay Gap: A Theoretical and Comparative Analysis

Abstract

We assess the impact of the welfare state on cross-national variation in the gender wage gap. Earnings inequality between men and women is conceptualized as resulting from their different locations in the class hierarchy, combined with the severity of wage differentials between and within classes. This decomposition contributes to identifying the relevant dimensions of welfare states and testing their impact on women’s relative earnings. Our empirical analysis is based on income and occupation-based indicators of class and utilizes microdata for 17 post-industrial societies. We find systematic differences between welfare regimes in the components of the gender gap. The evidence supports our claim that the state molds gender inequality in labor market attainments by influencing women’s class positions and regulating class inequality.