A quanUle regression decomposition of urban - rural wage gap in Vietnam

Abstract

   Tlie disparity in the living standards between urban and rural areas is a consequence of economicgrowth. Urban - rural wage gap is an important cause of this disparity. This paper appliedqiianlile regression and Machado & Mata decomposition on VHLSS 2012 to discover the factorsthat affect wages in each area. It also determines the differences in hourly wage between urbanand rural workers for Vie^iam in 2012. as well as figures out the causes of this gap. The resultsshowed that qualifications had a strong effect on wages. Additionally, urban workers receivedhigher wages than rural workers at all quantiles. A relatively laige part of the observed wagegap can be explained by urban - rural difference in characteristics.