Over the past few decades, a considerable number of studies have been made on the Taiwan’s gender wage discrimination. However, few studies have ever tries to explain the trend of the discrimination and to examine the relationship of the discrimination and macroeconomic environment. The first aim of this paper is using the 1978-2006 data to estimate and compare the trend of the gender wage discrimination and explaining its variation. And the second target of this paper attempts to analyze how the macroeconomic environment affects the discrimination using a VAR model

This study used two methods of wage decomposition, Oaxaca’s type of wage decomposition and wage decompositions with selectivity-corrected wage equations. The results indicate that the gender wage discrimination has been increased significantly and this phenomenon mainly causes from the different wage structures. The increase of female’s endowment only leads to the decrease of the gender wage differential after 1995 because of the relative stationary discrimination at that time. Finally, the preliminary findings suggest that discrimination has a positive relationship with real national income per capita and the female’s productivity. But there is a negative relationship between discrimination and the female’s labor force participation. However, such research is still in its infancy. Future research is obviously required, but this is the first attempt.

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