2019
Working Paper
HBS Working Paper Series

Using Online Data for International Wage Comparisons

By: Alberto Cavallo, Javier Cravino and Andres Drenik

Format:Print
| Language:English
| Pages:26

Abstract

We use a novel dataset from a large freelance website to document international wage differences for performing tasks that can be delivered online. The data records detailed information on tasks and worker characteristics which facilitates cross-country comparisons. We show large wage disparities across freelancers from different countries working on narrowly defined tasks. These wage differentials across countries are not driven by differences in observable worker characteristics. Real exchange rate levels account for about 50 percent of the cross-country-variation in average wages, and the elasticity of relative wages with respect to the real exchange rate is about 0.4. The magnitudes of these findings are pervasive across different country groups and types of jobs.

Keywords

Economics; Wages; Global Range; Data And Data Sets; Service Industry

Citation

Cavallo, Alberto, Javier Cravino, and Andres Drenik. "Using Online Data for International Wage Comparisons." Harvard Business School Working Paper, No. 20-042, September 2019.