In Costa Rica, wage differentials across industries are significantly smaller and also become more muted by the end of the period. Public employees enjoy wage rents over all other workers. However, it should be noted that, unlike Argentina and Brazil, the definition is not restricted to public administration and defense but more generally refer to the broad public; sector.<sup>3 5</sup> Public employees and retail workers did relatively worse, with the average wage premium of the former shrinking in almost half. Again, workers in the non-tradables sectors of construction and in social and personal services show the fastest average wage improvement. Much like in Brazil, wage growth in all sectors often eluded workers at the bottom quartile of the conditional wage distribution. In fact, public employees at the upper quartile experienced only a slight decline in their wage premium.

Summarizing, we found that in all three countries wages of retail workers have generally lagged behind. Manufacturing wages are not among the fastest growing. Often disadvantaged sectors (particularly, construction and social services) have experienced the fastest wage growth. Although this led to a general decline in inter-industry wage rents, especially in the tradable sectors, this was less so in Brazil. Workers in retail and personal services continued to earn significantly lower wages. Strikingly, the dynamics generating wage gains in the expanding sectors have not been homogeneous and often elude workers in the less privileged jobs, conditional on measured worker characteristics.

# **Regional and Demographics**

In most cases, cross country comparisons of wage differentials arising from demographic and regional variation are not possible due to data unavailability. Thus, the race of individuals was only available in Brazil, marital status was not available in the 1989 Brazilian survey, and we can only account for regional differences in Brazil and Costa Rica where by survey design a somewhat wider national representation is granted.

In all liree countries, controlling for other factors, married male workers enjoy a wage premium over single workers, which except for Brazil is often higher at the lower quantiles. This rose to roughly 11-13 percent in Argentina and Costa Rica, reflecting an increase in the first decile in Argentina and in both tails for Costa Rica. Although unavailable for 1989, it stood slightly higher in Brazil (18%). There are no significant differences in wages of single workers and those in a consensual union, except for a small premium in Brazil. Heads of non-single headed households did relatively worse than nonheads. While the former enjoyed a wage premium similar to that of married workers,<sup>36</sup> this declined consistently in all three countries, especially in Argentina.

The faster growth of wages of married male workers contrasts with the well documented decline in the married wage premitmi in the U.S. There, this has been found to be largely due to a decline in the male productivity effects associated with marriage

> **35** The Costa Rican survey asks workers explicitly whether they work in the private or public sector. Thus, the public sector dummy should presumably include workers ir the decentralized enterprises and Central Bank workers who often earn higher wages. The lower inter-industry wage differentials compared to the other countries may then be due to the purging of public wage effects across all economic sectors. **36** Presumably, as in the case of married workers, the wage premium for heads also reflects a return to unobserved worker characteristics which grant higher wages.

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