Woodcock, Simon (2006): Wage Differentials in the Presence of Unobserved Worker, Firm, and Match Heterogeneity.
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We consider the problem of estimating and decomposing wage differentials in the presence of unobserved worker, firm, and match heterogeneity. Controlling for these unobservables corrects omitted variable bias in previous studies. It also allows us to measure the contribution of unmeasured characteristics of workers, firms, and worker-firm matches to observed wage differentials. An application to linked employer-employee data shows that decompositions of inter-industry earnings differentials and the male-female differential are misleading when unobserved heterogeneity is ignored.
|Item Type:||MPRA Paper|
|Institution:||Simon Fraser University|
|Original Title:||Wage Differentials in the Presence of Unobserved Worker, Firm, and Match Heterogeneity|
|Keywords:||wage differentials; unobserved heterogeneity; employer-employee data|
|Subjects:||C - Mathematical and Quantitative Methods > C2 - Single Equation Models; Single Variables > C23 - Models with Panel Data; Longitudinal Data; Spatial Time Series
J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs > J31 - Wage Level and Structure; Wage Differentials
|Depositing User:||Simon Woodcock|
|Date Deposited:||06. Jan 2007|
|Last Modified:||16. Feb 2013 07:08|