Pay dispersion and earnings for women and men: A study of Swedish doctors

Purpose: Relatively little research has examined whether pay dispersion influences men's and women's earnings differently. The purpose of this paper is to fill this research gap. Design/methodology/approach: The authors used survey design and multiple regressions to analyze a sample of 650 Swedish medical doctors. Findings: Pay dispersion was found to be negatively associated with both men's and women's earnings. These effects were contingent on compensation informality and the individual's position in the pay structure. Specifically, when pay dispersion was high, high compensation informality resulted in women being paid less. The interaction of pay dispersion and compensation informality was unrelated to men's earnings. Also, women who were paid less suffered larger penalties when pay dispersion was higher, but their female counterparts who were paid more gained from the existence of greater pay dispersion. Originality/value: Examining the structure of labor markets on individual outcomes is increasing in importance due to the boundaryless nature of contemporary careers. As people cross functional, organizational, industrial, and even occupational boundaries more frequently in their career lifetimes, they are increasingly exposed to the structural effects of external labor markets. As such, the effects of factors such as pay dispersion and compensation informality in the market are becoming increasingly significant to the fortunes of women and men facing those conditions.