Blinder-Oaxaca Decomposition for Tobit Models

Thomas K. Bauer (1, 2, 3, 4) , Mathias Sinning (3, 5)

1 RWI Essen
2 RUB - Ruhr University Bochum = Ruhr-Universität Bochum
3 IZA Bonn
4 CEPR - Centre for Economic Policy Research
5 RWI Essen

In this paper, a decomposition method for Tobit-models is derived, which allows the differences in observed outcome variables between two groups to be decomposed into a part that is explained by differences in observed characteristics and a part attributable to differences in the estimated coefficients. Monte Carlo simulations demonstrate that in the case of censored dependent variables this decomposition method produces more reliable results than the conventional Blinder-Oaxaca decomposition for linear regression models. Finally, our method is applied to a decomposition of the gender wage gap using German data.

Mots clés: Social Sciences & Humanities

Thomas K. Bauer, Mathias Sinning. Blinder-Oaxaca Decomposition for Tobit Models. Applied Economics, 2010, 42 (12), pp.1569-1575. ⟨10.1080/00036840701721612⟩. ⟨hal-00593328⟩