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Detailed Gender Wage Gap Decompositions: Controlling for Worker Unobserved Heterogeneity Using Network Theory

Jamie Fogel, Bernardo Modenesi

arXiv 7 May 2024 · Econometrics

arXiv:2405.04365 · PDF · DOI · OpenAlex · Extracted main text

Abstract

Recent advances in the literature of decomposition methods in economics have allowed for the identification and estimation of detailed wage gap decompositions. In this context, building reliable counterfactuals requires using tighter controls to ensure that similar workers are correctly identified by making sure that important unobserved variables such as skills are controlled for, as well as comparing only workers with similar observable characteristics. This paper contributes to the wage decomposition literature in two main ways: (i) developing an economic principled network based approach to control for unobserved worker skills heterogeneity in the presence of potential discrimination; and (ii) extending existing generic decomposition tools to accommodate for potential lack of overlapping supports in covariates between groups being compared, which is likely to be the norm in more detailed decompositions. We illustrate the methodology by decomposing the gender wage gap in Brazil.

Citation extraction

35
references
73
in-text mentions
35
distinct cited
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self-citations
12,490
main-text words

appendix boundary found by appendix_command · 87% of the source is main text. Read the extracted text to check this.

Most heavily cited references

The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.

ReferenceIntensityMentionsSectionsMain text
1Fogel and Modenesi (2023) What is a Labor Market? Classifying Workers and Jobs Using Network Theory1.00083100%
2Blinder (1973) Wage Discrimination: Reduced Form and Structural Estimates0.84333100%
3Fortin, Lemieux and Firpo (2011) Chapter 1 - Decomposition Methods in Economics0.84333100%
4Oaxaca (1973) Male-Female Wage Differentials in Urban Labor Markets0.84333100%
5Modenesi (2022) Advancing Distribution Decomposition Methods Beyond Common Supports: Applications to Racial Wealth Disparities self0.81142100%
6Ñopo (2008) Matching as a Tool to Decompose Wage Gaps0.81142100%
7Lindenlaub (2017) Sorting multidimensional types: Theory and application0.73732100%
8Tan (2018) Multidimensional heterogeneity and matching in a frictional labor market - An application to polarization0.73732100%
9DiNardo, Fortin and Lemieux (1996) Labor Market Institutions and the Distribution of Wages, 1973-1992: A Semiparametric Approach0.73732100%
10Peixoto (2018) Nonparametric weighted stochastic block models0.73732100%

Showing the top 10 of 35 scored citations.

Cited by, within the corpus

arXiv econ.EM papers that cite this one, ranked by how heavily they lean on it.

Citing paperIntensityMentionsSections
1Advancing Distribution Decomposition Methods Beyond Common Supports: Applications to Racial Wealth Disparities0.64422