Wage Determination and the Gender Wage Gap in Kenya: Any Evidence of Gender Discrimination?

This study presents an analysis of the determinants of wages as well as a decomposition of the gender gap across sectors in Kenya. The study tests the hypothesis that women participate less in the labour market partly because of their characteristics and partly because of gender discrimination in wage setting. Multinomial logit techniques and ordinary least squares (OLS) with and without sample selection are used to explain participation and earnings. The results indicate that education and other demographic factors are important determinants of the choice of sector of employment and earnings and that there is no serious self-selectivity problem. The gender gap decomposition results suggest that favouritism towards men is pronounced in all sectors, while there is no evidence of discrimination against women. The study recommends investment in instruments to reduce gender inequalities in access to education and also government policies that minimize favouritism towards men.