Chapter

Further Regression Issues in Labour Economics

Stephen Bazen

in Econometric Methods for Labour Economics

Published in print September 2011 | ISBN: 9780199576791
Published online January 2012 | e-ISBN: 9780191731136 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780199576791.003.0003

Series: Practical Econometrics

Further Regression Issues in Labour Economics

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This chapter discusses the four aspects of regression analysis as used in labour economics. Decomposing differences between groups — males and females, for example — is one of the key uses of econometric estimates, and this is treated in Section 2.1 of this chapter. The traditional way of undertaking a decomposition is to attribute part of the difference in the means of a variable (say earnings) for two groups to differences in characteristics, and the remainder to other factors. This is the Oaxaca decomposition of the difference in the means for two groups. Going beyond the average is made possible by using an approach that estimates the relationship between the dependent and explanatory variables at different points in the distribution. This is possible using quantile regression and is presented in the next section of the chapter. Methods for analysing panel data are covered in Section 2.3. In the final part of this chapter, the issue of estimating standard errors is addressed.

Keywords: regression analysis; linear regression; Oaxaca decomposition; quantile regression; panel data; standard error estimation

Chapter.  8203 words.  Illustrated.

Subjects: Econometrics and Mathematical Economics

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