A SIMPLE SOLUTION TO THE IDENTIFICATION PROBLEM IN DETAILED WAGE DECOMPOSITIONS

@inproceedings{Yun2005ASS,
  title={A SIMPLE SOLUTION TO THE IDENTIFICATION PROBLEM IN DETAILED WAGE DECOMPOSITIONS},
  author={Myeong-Su Yun},
  year={2005}
}
Oaxaca and Ransom (1999) show that a detailed decomposition of the coefficients effect is destined to suffer from an identification problem since the detailed coefficients effect attributed to a dummy variable is not invariant to the choice of reference groups. It turns out that the identification problem in the decomposition equation is a disguised identification problem of constant and dummy variables in a regression equation. This paper proposes a simple and natural remedy for this problem… CONTINUE READING

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