The Gender Wage Gap: Skills, Sorting, and Returns

Abstract

There is a large gender wage gap among college graduates. This gender gap could be partially driven by differences in college major and prior skills. We use Swedish register data to study how much of the gender gap can be explained by differences in majors, skills, and skill prices. College majors explain 60 percent of the gender wage gap, but large gaps remain within majors. We find that within-major wage gaps are driven by neither differences in multidimensional skills nor returns to these skills. In fact, women are positively selected in terms of college preparation and skills in almost every major.