Workers' wages are not set in a spot market. Instead, the wages of most workers-at least those who do not switch jobs-typically change only annually and are mediated by a complex set of institutions and factors such as contracts, unions, standards of fairness, minimum wage policy, transfers of risk, and incomplete information. The goal of the International Wage Flexibility Project (IWFP)-a consortium of over 40 researchers with access to individual workers' earnings data for 16 countries-is to provide new microeconomic evidence on how wages change for continuing workers. Wage changes due to worker mobility are governed by different processes and are beyond the scope of this study.A key question in the theoretical and empirical literature, as reviewed in

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JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org.. University of Wisconsin Press andThe Board of Regents of the University of Wisconsin System are collaborating with JSTOR to digitize, preserve and extend access to The Journal of Human Resources. ABSTRACTThe efficacy of policies to narrow the malelfemale wage differential depends partly on the size of the portion(s) of the gap targeted. Previous research finds no between-sex wage gap within occupations within employer (job-cell). This is the first study to disentangle segregation by occupation from that based on employer or on job-cell. In five industries, controlling for other forms of segregation, occupational segregation produces a gap of 11 percent (manufacturing) to 26 percent (services). The wage gaps from establishment and job-cell segregation are about 6 percent each. Since comparable worth acts on the occupation and job-cell components, it has a potentially large impact. Erica L. Groshen is an economist at the Federal Reserve Bank of Cleveland. The author thanks professors Richard B. Freeman and John T. Dunlop for help in obtaining these data, and the Bureau of Labor Statistics for providing access to them. Paula Loboda provided invaluable research assistance. Comments from

This paper reviews the literature on wage differences among industries and establishments. After surveying the empirical evidence on intra‐ and interindustry wage differentials, five alternative explanations for employer‐based wage differentials among observation equivalent workers are described. The paper concludes with a summary, a discussion of policy implications, and directions for future research.