On The Measurement Of Illegal Wage Discrimination: The Michael Jordan Paradox
AbstractStandard wage discrimination models assume that independent observers are able to distinguish a priori which workers are suffering from discrimination. However, this assumption may be inadequate when severe penalties can be imposed on discriminatory employers. Antidiscrimination laws will induce firms to behave in such a way that independent observers (for instance, lawyers, economists) cannot easily detect discriminatory practices. This problem can be solved by estimating the discriminatory wage gap using finite mixture or latent class models because these procedures do not require the a priori classification of workers. In fact, the standard discrimination model can be seen as a particular case of our method when the probabilities of belonging to a group are fixed (to one or zero). We estimate discrimination coefficients for Germany and United Kingdom using the European Community Household Panel (ECHP). We obtain unambiguous higher discrimination in Germany for a wide set of measures
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by ECINEQ, Society for the Study of Economic Inequality in its series Working Papers with number 38.
Length: 34 pages
Date of creation: 2006
Date of revision:
discrimination; wages; latent class model; finite mixture models.;
Find related papers by JEL classification:
- J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General
- J70 - Labor and Demographic Economics - - Labor Discrimination - - - General
This paper has been announced in the following NEP Reports:
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Newell, Andrew T. & Reilly, Barry, 2001.
"The Gender Pay Gap in the Transition from Communism: Some Empirical Evidence,"
IZA Discussion Papers
268, Institute for the Study of Labor (IZA).
- Newell, Andrew & Reilly, Barry, 2001. "The gender pay gap in the transition from communism: some empirical evidence," Economic Systems, Elsevier, Elsevier, vol. 25(4), pages 287-304, December.
- Andrew Newell & Barry Reilly, 2000. "The Gender Pay Gap in the Transition from Communism: Some Empirical Evidence," William Davidson Institute Working Papers Series 305, William Davidson Institute at the University of Michigan.
- John DiNardo & Nicole M. Fortin & Thomas Lemieux, 1995.
"Labor Market Institutions and the Distribution of Wages, 1973-1992: A Semiparametric Approach,"
NBER Working Papers
5093, National Bureau of Economic Research, Inc.
- DiNardo, John & Fortin, Nicole M & Lemieux, Thomas, 1996. "Labor Market Institutions and the Distribution of Wages, 1973-1992: A Semiparametric Approach," Econometrica, Econometric Society, Econometric Society, vol. 64(5), pages 1001-44, September.
- Nidardo, J. & Fortin, N. & Lemieux, T., 1994. "Labor Market Institutions and the Distribution of Wages, 1973-1992: A Semiparametric Approach," Papers, California Irvine - School of Social Sciences 93-94-15, California Irvine - School of Social Sciences.
- Dinardo, J. & Fortin, N.M. & Lemieux, T., 1994. "Labor Market Institutions and the Distribution of Wages, 1973-1992: A Semiparametric Approach," Cahiers de recherche, Centre interuniversitaire de recherche en Ã©conomie quantitative, CIREQ 9406, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
- Dinardo, J. & Fortin, N.M. & Lemieux, T., 1994. "Labor Market Institutions and the Distribution of Wages, 1973-1992: a Semiparametric Approach," Cahiers de recherche, Universite de Montreal, Departement de sciences economiques 9406, Universite de Montreal, Departement de sciences economiques.
- Oaxaca, Ronald, 1973. "Male-Female Wage Differentials in Urban Labor Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(3), pages 693-709, October.
- Dennis J. Aigner & Glen G. Cain, 1977. "Statistical theories of discrimination in labor markets," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 30(2), pages 175-187, January.
- Jenkins, Stephen P., 1994. "Earnings discrimination measurement : A distributional approach," Journal of Econometrics, Elsevier, Elsevier, vol. 61(1), pages 81-102, March.
- Alan S. Blinder, 1973. "Wage Discrimination: Reduced Form and Structural Estimates," Journal of Human Resources, University of Wisconsin Press, vol. 8(4), pages 436-455.
- José Mata & José A. F. Machado, 2005. "Counterfactual decomposition of changes in wage distributions using quantile regression," Journal of Applied Econometrics, John Wiley & Sons, Ltd., John Wiley & Sons, Ltd., vol. 20(4), pages 445-465.
- James Albrecht & Anders Bjorklund & Susan Vroman, 2003.
"Is There a Glass Ceiling in Sweden?,"
Journal of Labor Economics, University of Chicago Press,
University of Chicago Press, vol. 21(1), pages 145-177, January.
- Greene, William, 2005. "Reconsidering heterogeneity in panel data estimators of the stochastic frontier model," Journal of Econometrics, Elsevier, Elsevier, vol. 126(2), pages 269-303, June.
- Phelps, Edmund S, 1972. "The Statistical Theory of Racism and Sexism," American Economic Review, American Economic Association, American Economic Association, vol. 62(4), pages 659-61, September.
- Beard, T Randolph & Caudill, Steven B & Gropper, Daniel M, 1991. "Finite Mixture Estimation of Multiproduct Cost Functions," The Review of Economics and Statistics, MIT Press, vol. 73(4), pages 654-64, November.
- Juan Gabriel Rodriguez & Rafael Salas & Juan Prieto-Rodriguez, 2008. "A theoretical model of wage discrimination with inspection fines," Economics Bulletin, AccessEcon, vol. 10(3), pages 1-9.
- repec:ebl:ecbull:v:10:y:2008:i:3:p:1-9 is not listed on IDEAS
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Maria Ana Lugo).
If references are entirely missing, you can add them using this form.