These findings are consistent with previous work that examined differences in wage inequality across countries (Blau and Khan, 2005, Fournier and Koske, 2012). Returns to education are also found to be an important role in explaining the rise in earnings inequality (see Autor, 2014). In these countries, however, the magnitude of the contribution is quite small. Two types of explanation are commonly proposed in the literature. The first emphasises relative supply and demand for skills: characteristics in lower (net) supply get higher rewards. The second, emphasises the role played by labour market institutions such as minimum wages, the degree of unionisation and the rules governing wage bargaining.