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Wage-setting institutions narrow the gender pay
gap but may reduce employment for some women

There are large international differences in the
gender pay gap. In some developed countries in 2010–2012, women were close
to earnings parity with men, while in others large gaps remained. Since
women and men have different average levels of education and experience and
commonly work in different industries and occupations, multiple factors can
influence the gender pay gap. Among them are skill supply and demand,
unions, and minimum wages, which influence the economywide wage returns to
education, experience, and occupational wage differentials. Systems of wage
compression narrow the gender pay gap but may also lower demand for female
workers.