The Reasons of Differences Between the Wages of Large Industries in Iran

Based on the efficiency of wage hypothesis, this paper examines the determinants of wage dispersion of large manufacturing industries using a panel of 4-digit ISIC data during the period of 1998-2007 in Iran. The findings explain that there is a significant difference between wages in the sampled data. By eliminating the effects of individual measured and firm characteristics such as gender, education, expert, experience, efficiency, firm size and so on. The differences in wages have remained significant yet. The results confirm the efficiency of wage theory, in which the wages dispersion cannot merely attribute to labor force characteristics.