Interindustry Wage Differentials in Brazil

An examination is made of the interindustry wage differentials in Brazilian industries. The empirical analysis is based on cross-sectional data on individuals working the manufacturing industry in Sao Paulo, one of the greater industrial areas in Brazil. The Brazilian case shows a number of similarities to previous studies, as there is a significant and stable pattern of interindustry wage differentials. However, it also raises additional issues, namely, a relationship between technology and wages that extends beyond the size effect, as well as the similarities of the wage structure across countries, even when workers' characteristics are controlled. The results have also proven to be quite robust to methodological estimation issues, that is, changes in the control variables and full correction for the least-squares sampling error.