Article ID Journal Published Year Pages File Type
5059036 Economics Letters 2015 5 Pages PDF
Abstract

•We present a detailed decomposition method helpful in analyzing the contributing effects in cross-sectional studies.•The method specifies the contribution of every variable in the model.•The detailed decomposition result can be applied to models in a synthetic cohort analysis.•We provide a Stata estimator for practitioners to implement our method.

We present a detailed decomposition method and provide a Stata estimator to assess relative changes between two groups over time in a synthetic cohort analysis. Using the convergence of black-white wage gap between 1960 and 1970 as an example, we show that education accounts for 73% of the value of change in characteristics while experience explains only 3%.

Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
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