The gender gap in earnings is analyzed using data for 250,000 Chinese industrial firms in 2004. The
skill-weighted gender wage is estimated to be 12 percent and stems entirely from the female wage
disadvantage among employees with below college education. Firms’ payments to social insurance
programs do not give further polarization of earnings, and descriptive statistics contradict the notion
that women are segregated into sectors with low program participation rates. Narrower gender wage
gaps are found in more labor intensive industries and in private domestic firms, suggesting that the
market transition has not hurt the relative wages of female industrial workers. Finally, women’s
earnings disadvantage is fully accounted for by smaller contributions to value added, suggesting that
firms do not wage-discriminate against female employees.