Arbeitspapier
A note on decompositions in fixed effects models in the presence of time-invariant characteristics
Though theoretically appealing and very popular amongst labour economists, the interpretation of the unexplained part of the Oaxaca (1973) decomposition as discrimination rather than an omitted variable problem in cross-section data has often been criticised. In this note it is shown that this problem extends also to panel data and moreover that in a fixed effects model including time invariant regressors omitted variables are a necessary and deliberate consequence. Monte Carlo simulation is used to show the extent of the bias. Special cases and practical implications are discussed.
- Language
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Englisch
- Bibliographic citation
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Series: IZA Discussion Papers ; No. 1886
- Classification
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Wirtschaft
Multiple or Simultaneous Equation Models: Panel Data Models; Spatio-temporal Models
- Subject
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decomposition
fixed effects
Monte Carlo study
- Event
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Geistige Schöpfung
- (who)
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Heitmüller, Axel
- Event
-
Veröffentlichung
- (who)
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Institute for the Study of Labor (IZA)
- (where)
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Bonn
- (when)
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2005
- Handle
- Last update
-
10.03.2025, 11:44 AM CET
Data provider
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ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Heitmüller, Axel
- Institute for the Study of Labor (IZA)
Time of origin
- 2005
Other Objects (12)
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COMMON FIXED POINT AND INVARIANT APPROXIMATION RESULTS
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Optional decompositions under constraints
Optional decompositions under constraints
Common fixed point and invariant approximation in hyperbolic ordered metric spaces
Universal predictions of Siegel modular invariant theories near the fixed points
The almost fixed point property is not invariant under isometric renormings
Applications of fixed point theorems in the theory of invariant subspaces
Common fixed point and invariant approximation results
COMMON FIXED POINT AND INVARIANT APPROXIMATION RESULTS
WARP decompositions
Decompositions in Semirings
Real exchange rate decompositions
Inequality decompositions: A reconciliation
Optional decompositions under constraints
Optional decompositions under constraints
Common fixed point and invariant approximation in hyperbolic ordered metric spaces
Universal predictions of Siegel modular invariant theories near the fixed points
The almost fixed point property is not invariant under isometric renormings
Applications of fixed point theorems in the theory of invariant subspaces
Common fixed point and invariant approximation results
COMMON FIXED POINT AND INVARIANT APPROXIMATION RESULTS
WARP decompositions
Decompositions in Semirings
Real exchange rate decompositions
Inequality decompositions: A reconciliation
Optional decompositions under constraints
Optional decompositions under constraints
Common fixed point and invariant approximation in hyperbolic ordered metric spaces
Universal predictions of Siegel modular invariant theories near the fixed points
The almost fixed point property is not invariant under isometric renormings