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Revisiting gender identity and relative income within households: A cautionary tale on the potential pitfalls of density estimators

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  • Daniel Kuehnle
  • Michael Oberfichtner
  • Kerstin Ostermann

Abstract

We show that Bertrand et al.'s (QJE, 2015, ) finding of a sharp drop in the relative income distribution within married couples at the point where wives start to earn more than their husbands is unstable across different estimation procedures and varies across contexts. We apply the estimators by McCrary (JoE, 2008, McC) and Cattaneo et al. (JASA, 2020, CJM) to administrative data from the United States and Germany and compare their performance in a simulation. Large bins cause McC to substantially overreject the null hypothesis, and mass points close to the potential discontinuity affect McC more than CJM.

Suggested Citation

  • Daniel Kuehnle & Michael Oberfichtner & Kerstin Ostermann, 2021. "Revisiting gender identity and relative income within households: A cautionary tale on the potential pitfalls of density estimators," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 36(7), pages 1065-1073, November.
    • Handle: RePEc:wly:japmet:v:36:y:2021:i:7:p:1065-1073
    DOI: 10.1002/jae.2853
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • C18 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Methodolical Issues: General
    • D10 - Microeconomics - - Household Behavior - - - General
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination

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