Methods for Measuring Aggregate Costs of Conflict

This paper reviews the methods for measuring the economic cost of conflict. Estimating the economic costs of conflict requires a counterfactual calculation, which makes this a very difficult task. Social researchers have resorted to different estimation methods depending on the particular effect in question. The method used in each case depends on the units being analyzed (firms, sectors, regions or countries), the outcome variable under study (aggregate output, market valuation of firms, market shares, etc.) and data availability (a single cross-section, time series or panel data). This paper reviews existing methods used in the literature to assess the economic impact of conflict: cost accounting, cross-section methods, time series methods, panel data methods, gravity models, event studies, natural experiments and comparative case studies. The paper ends with a discussion of cost estimates and directions for further research.

Decomposing the Gender Wage Gap: The effect of firms, occupations and Job Stratification

This paper presents new evidence on the role of segregation into firms, occupations within a firm and stratification into professional categories within firm-occupations in explaining the gender wage gap. I use a generalized earnings model that allows observed and unobserved group characteristics to have different impact on wages of men and women within the same group. The database is a large sample of individual wage data from the 1995 Spanish Wage Structure Survey. Results indicate that firm segregation in our sample accounts for around one-fifth of the raw gender wage gap. Occupational segregation within firms accounts for about one-third of the raw wage gap, and stratification into different professional categories within firms and occupations explains another one-third of it. The remaining one-fifth of the overall gap arises from better outcomes of men relative to women within professional categories. It is also found that rewards to both observable and unobservable skills, particularly those related to education, are higher for males than for females within the same group. Finally, mean wages in occupations or job categories with a higher fraction of female co-workers are lower, but the negative impact of femaleness in higher for women.