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Labour market discrimination: are there significant differences between the various decomposition procedures?

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  • Jacques Silber
  • Michal Weber

Abstract

Economists have usually called the proportion of the average wage gap between two groups which could not be explained by individual characteristics 'discrimination'. Recently, several theories have suggested that labour market discrimination, on the one hand, lowers the wages of the 'minority' group, and on the other, leads to higher pay for the 'majority' group. In a recent survey of the various methods used to decompose the overall wage differential between two groups, Oaxaca and Ransom compared five approaches in the contexts of race and gender discrimination. This paper checks whether there are significant differences between the various decomposition procedures which have appeared in the literature. The tests are based on bootstrap techniques.

Suggested Citation

  • Jacques Silber & Michal Weber, 1999. "Labour market discrimination: are there significant differences between the various decomposition procedures?," Applied Economics, Taylor & Francis Journals, vol. 31(3), pages 359-365.
  • Handle: RePEc:taf:applec:v:31:y:1999:i:3:p:359-365
    DOI: 10.1080/000368499324345
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    References listed on IDEAS

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    1. Bergmann, Barbara R, 1971. "The Effect on White Incomes of Discrimination in Employment," Journal of Political Economy, University of Chicago Press, vol. 79(2), pages 294-313, March-Apr.
    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. Cotton, Jeremiah, 1988. "On the Decomposition of Wage Differentials," The Review of Economics and Statistics, MIT Press, vol. 70(2), pages 236-243, May.
    4. Reimers, Cordelia W, 1983. "Labor Market Discrimination against Hispanic and Black Men," The Review of Economics and Statistics, MIT Press, vol. 65(4), pages 570-579, November.
    5. David Neumark, 1988. "Employers' Discriminatory Behavior and the Estimation of Wage Discrimination," Journal of Human Resources, University of Wisconsin Press, vol. 23(3), pages 279-295.
    6. 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.
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    Citations

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    Cited by:

    1. Weichselbaumer, Doris & Winter-Ebmer, Rudolf, 2003. "Rhetoric in Economic Research: The Case of Gender Wage Differentials," CEPR Discussion Papers 4128, C.E.P.R. Discussion Papers.
    2. Bernd Fitzenberger & Karsten Kohn & Qingwei Wang, 2011. "The erosion of union membership in Germany: determinants, densities, decompositions," Journal of Population Economics, Springer;European Society for Population Economics, vol. 24(1), pages 141-165, January.
    3. Elvin Afandi & Majid Kermani, 2014. "Bridging the Gender Gap in Entrepreneurship: Evidence from Europe," William Davidson Institute Working Papers Series wp1074, William Davidson Institute at the University of Michigan.
    4. Weichselbaumer, Doris & Winter-Ebmer, Rudolf, 2003. "A Meta-Analysis of the International Gender Wage Gap," IZA Discussion Papers 906, Institute of Labor Economics (IZA).
    5. J.G. Hirschberg & D.J. Slottje, 2002. "Bounding Estimates of Wage Discrimination," Department of Economics - Working Papers Series 854, The University of Melbourne.
    6. Weichselbaumer, Doris & Winter-Ebmer, Rudolf, 2003. "The Effects of Competition and Equal Treatment Laws on the Gender Wage Differential," CEPR Discussion Papers 4015, C.E.P.R. Discussion Papers.
    7. Ben Jann, 2008. "A Stata implementation of the Blinder-Oaxaca decomposition," ETH Zurich Sociology Working Papers 5, ETH Zurich, Chair of Sociology, revised 14 May 2008.
    8. Mohamed Jellal & Christophe Nordman & Francois-Charles Wolff, 2008. "Evidence on the glass ceiling effect in France using matched worker-firm data," Applied Economics, Taylor & Francis Journals, vol. 40(24), pages 3233-3250.
    9. Amélia Bastos & Graça Leão Fernandes & José Passos, 2004. "Estimation of Gender Wage Discrimination in the Portuguese Labour Market," Notas Económicas, Faculty of Economics, University of Coimbra, issue 19, pages 35-48, June.
    10. P. N. Junankar & Satya Paul & Wahida Yasmeen, 2010. "Are Asian Migrants Discriminated Against In The Labor Market? A Case Study Of Australia," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 55(04), pages 619-646.
    11. Chen, Yiu Por (Vincent) & Zhang, Yuan, 2018. "A decomposition method on employment and wage discrimination and its application in urban China (2002–2013)," World Development, Elsevier, vol. 110(C), pages 1-12.
    12. Nicole Schneeweis, 2011. "Educational institutions and the integration of migrants," Journal of Population Economics, Springer;European Society for Population Economics, vol. 24(4), pages 1281-1308, October.
    13. repec:dau:papers:123456789/4377 is not listed on IDEAS
    14. Furdas, Marina & Kohn, Karsten, 2010. "What's the Difference?! Gender, Personality, and the Propensity to Start a Business," IZA Discussion Papers 4778, Institute of Labor Economics (IZA).
    15. Joern Block & Karsten Kohn & Danny Miller & Katrin Ullrich, 2015. "Necessity entrepreneurship and competitive strategy," Small Business Economics, Springer, vol. 44(1), pages 37-54, January.
    16. Yue Ma & Ying Chu Ng, 2008. "Bootstrapping statistical inferences of decomposition methods for gender earnings differentials," Applied Economics, Taylor & Francis Journals, vol. 40(12), pages 1583-1593.
    17. Essama-Nssah, , B. & Bassol3, Leandre & Paul, Saumik, 2010. "Accounting for heterogeneity in growth incidence in Cameroon," Policy Research Working Paper Series 5464, The World Bank.
    18. Essama-Nssah, B. & Bassole, Leandre, 2010. "A counterfactual analysis of the poverty impact of economic growth in Cameroon," Policy Research Working Paper Series 5249, The World Bank.
    19. Heinze, Anja, 2010. "Beyond the mean gender wage gap: Decomposition of differences in wage distributions using quantile regression," ZEW Discussion Papers 10-043, ZEW - Leibniz Centre for European Economic Research.

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