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Average Wage Gaps and Oaxaca–Blinder Decompositions

Author

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  • Sloczynski, Tymon

    (Brandeis University)

Abstract
In this paper I develop a new version of the Oaxaca–Blinder decomposition whose unexplained component recovers a parameter which I refer to as the average wage gap. Under a particular conditional independence assumption, this estimand is equivalent to the average treatment effect (ATE). I also provide treatment-effects reinterpretations of the Reimers, Cotton, and Fortin decompositions as well as estimate average wage gaps, average wage gains for men, and average wage losses for women in the United Kingdom. Conditional wage gaps increase across the wage distribution and therefore, on average, male gains are larger than female losses.

Suggested Citation

  • Sloczynski, Tymon, 2015. "Average Wage Gaps and Oaxaca–Blinder Decompositions," IZA Discussion Papers 9036, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp9036
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    More about this item

    Keywords

    glass ceilings; gender wage gaps; decomposition methods; treatment effects;
    All these keywords.

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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