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Decomposition of non-linear models using simulated residuals

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  • Wolff, François-Charles

Abstract

This paper proposes to decompose non-linear models deduced from a latent regression framework using the latent dependent outcome as dependent variable and the Oaxaca–Blinder decomposition technique. Values of the unobserved latent outcome are obtained using simulated residuals.

Suggested Citation

  • Wolff, François-Charles, 2012. "Decomposition of non-linear models using simulated residuals," Economics Letters, Elsevier, vol. 116(3), pages 346-348.
  • Handle: RePEc:eee:ecolet:v:116:y:2012:i:3:p:346-348
    DOI: 10.1016/j.econlet.2012.03.034
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    References listed on IDEAS

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    1. Fairlie, Robert W, 1999. "The Absence of the African-American Owned Business: An Analysis of the Dynamics of Self-Employment," Journal of Labor Economics, University of Chicago Press, vol. 17(1), pages 80-108, January.
    2. 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, vol. 14(3), pages 693-709, October.
    3. 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.
    4. Yun, Myeong-Su, 2004. "Decomposing differences in the first moment," Economics Letters, Elsevier, vol. 82(2), pages 275-280, February.
    5. Oaxaca, Ronald L. & Ransom, Michael R., 1994. "On discrimination and the decomposition of wage differentials," Journal of Econometrics, Elsevier, vol. 61(1), pages 5-21, March.
    6. Mathia Sinning & Markus Hahn & Thomas K. Bauer, 2008. "The Blinder–Oaxaca decomposition for nonlinear regression models," Stata Journal, StataCorp LP, vol. 8(4), pages 480-492, December.
    7. Ben Jann, 2008. "The Blinder–Oaxaca decomposition for linear regression models," Stata Journal, StataCorp LP, vol. 8(4), pages 453-479, December.
    8. Gourieroux, Christian & Monfort, Alain & Renault, Eric & Trognon, Alain, 1987. "Simulated residuals," Journal of Econometrics, Elsevier, vol. 34(1-2), pages 201-252.
    9. Thomas Bauer & Mathias Sinning, 2008. "An extension of the Blinder–Oaxaca decomposition to nonlinear models," AStA Advances in Statistical Analysis, Springer;German Statistical Society, vol. 92(2), pages 197-206, May.
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    Citations

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    Cited by:

    1. Chung Choe & SeEun Jung & Ronald L. Oaxaca, 2020. "Identification and decompositions in probit and logit models," Empirical Economics, Springer, vol. 59(3), pages 1479-1492, September.
    2. Laetitia Duval & François-Charles Wolff, 2016. "Emigration intentions of Roma: evidence from Central and South-East Europe," Post-Communist Economies, Taylor & Francis Journals, vol. 28(1), pages 87-107, January.
    3. Bazen, Stephen & Joutard, Xavier & Magdalou, Brice, 2017. "An Oaxaca decomposition for nonlinear models," Journal of Economic and Social Measurement, IOS Press, issue 2, pages 101-121.
    4. Laetitia Duval & François-Charles Wolff, 2016. "“I even met happy gypsies”," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 24(4), pages 727-764, October.
    5. Laetitia Duval & François-­charles Wolff, 2015. "" I Even Met Happy Gypsies " : Life Satisfaction of Roma Youth in the Balkans," Working Papers hal-01219250, HAL.

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    More about this item

    Keywords

    Blinder–Oaxaca decomposition; Non-linear models; Simulated residuals;
    All these keywords.

    JEL classification:

    • C20 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - General

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