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An extension of the Blinder-Oaxaca decomposition technique to logit and probit models
Abstract
The Blinder-Oaxaca decomposition technique is widely used to identify and quantify the separate contributions of group differences in measurable characteristics, such as education, experience, marital status, and geographical differences to racial and gender gaps in outcomes. The technique cannot be used directly, however, if the outcome is binary and the coefficients are from a logit or probit model. I describe a relatively simple method of performing a decomposition that uses estimates from a logit or probit model. Expanding on the original application of the technique in Fairlie [3], I provide a more thorough discussion of how to apply the technique, an analysis of the sensitivity of the decomposition estimates to different parameters, and the calculation of standard errors. I also compare the estimates to Blinder-Oaxaca decomposition estimates and discuss an example of when the Blinder-Oaxaca technique may be problematic.
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Cites
Male-female wage differentials in urban labor markets
Oaxaca, R. (1973) · International Economic Review · doi:10.2307/2525981 · Cited by 8,463
Wage discrimination: Reduced form and structural estimates
Blinder, A. S. (1973) · The Journal of Human Resources · doi:10.2307/144855 · Cited by 6,922
On discrimination and the decomposition of wage differentials
Oaxaca, R. L., & Ransom, M. R. (1994) · Journal of Econometrics · doi:10.1016/0304-4076(94)90074-4 · Cited by 1,657
Employers’ discriminatory behavior and the estimation of wage discrimination
(2004) · Sex Differences in Labor Markets · doi:10.4324/9780203799918-12 · Cited by 783
The economic analysis of labor market discrimination: A surveyPreprint
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On Decomposing the Wage Gap: A Critical Comment on Blinder's Method
Jones, F. L. (1983) · The Journal of Human Resources · doi:10.2307/145660 · Cited by 320
Calculation of approximate variances for wage decomposition differentials
Oaxaca, R. L., & Ransom, M. R. (1998) · Journal of Economic and Social Measurement · doi:10.3233/jem-1998-0143 · Cited by 126
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Stunting in childhood: an overview of global burden, trends, determinants, and drivers of decline
Vaivada, T., Akseer, N., Akseer, S., Somaskandan, A., Stefopulos, M., & Bhutta, Z. A. (2020) · The American Journal of Clinical Nutrition · doi:10.1093/ajcn/nqaa159 · Cited by 381
A multidisciplinary survey on discrimination analysis
Romei, A., & Ruggieri, S. (2014) · The Knowledge Engineering Review · doi:10.1017/s0269888913000039 · Cited by 288
Anatomy of an Enduring Gender Gap: The Evolution of Women’s Participation in Computer Science
Sax, L. J., Lehman, K. J., Jacobs, J. A., Kanny, M. A., Lim, G., Monje-Paulson, L., & Zimmerman, H. B. (2017) · The Journal of Higher Education · doi:10.1080/00221546.2016.1257306 · Cited by 261
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Metadata
- Authors
- Fairlie, R. W.
- Venue
- Journal of Economic and Social Measurement
- Publisher
- SAGE Publications
- Published
- 2005-11
- Volume
- 30
- Issue
- 4
- Pages
- 305-316
- ISSN
- 0747-9662 (ISSN-L)
- 1875-8932
- OpenAlex
- W3123547180
- Cited by
- 1,077
- References
- 7
- FWCI
- 57.35
- Type
- journal article
- Language
- en
- Open access
- closed
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