Determinants of earnings in Macedonia: assessing the difference between low-paid and highly-paid employees.

The problem of 'low-pay' as a relatively new social phenomenon in Europe has received considerable attention over the past 20 years. The analysis of the low-pay in low income countries, where the average earning is already low by international standards is more complex and represents a challenging task. The stylised facts show that earnings are not uniform across the population, but they vary according to a number of socio-economic and demographic characteristics. The aim of this paper is to assess the earning function of employed workers in Macedonia by paying attention to the difference between low-paid and highly-paid employees. For this purpose, we estimate Mincer type model that explains wage income as a function of education, experience and other employee- and job-specific characteristics. As a result, we come up with a clear picture of the earnings determinants and we formulate appropriate policy recommendations. [ABSTRACT FROM AUTHOR]