Beyond Oaxaca-Blinder: Accounting for Differences in Household Income Distributions Across Countries
The authors develop a microeconometric method to account for differences across distributions of household income. Going beyond the determination of earnings in labor markets, they also estimate statistical models for occupational choice and for co...
| Main Authors: | , , |
|---|---|
| Language: | English en_US |
| Published: |
World Bank, Washington, D.C.
2013
|
| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2002/04/1769436/beyond-oaxaca-blinder-accounting-differences-household-income-distributions-across-countries http://hdl.handle.net/10986/14287 |
| Summary: | The authors develop a microeconometric
method to account for differences across distributions of
household income. Going beyond the determination of earnings
in labor markets, they also estimate statistical models for
occupational choice and for conditional distributions of
education, fertility, and nonlabor incomes. The authors
import combinations of estimated parameters from these
models to simulate counterfactual income distributions. This
allows them to decompose differences between functionals of
two income distributions (such as inequality or poverty
measures) into shares because of differences in the
structure of labor market returns (price effects),
differences in the occupational structure, and differences
in the underlying distribution of assets (endowment
effects). The authors apply the method to the differences
between the Brazilian income distribution and those of
Mexico and the United States, and find that most of
Brazil's excess income inequality is due to underlying
inequalities in the distribution of two key endowments:
access to education and to sources of nonlabor income,
mainly pensions. |
|---|