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A decomposition method to evaluate the ‘paradox of progress’ with evidence for Argentina

Javier Alejo, Leonardo Gasparini, Gabriel Montes-Rojas and Walter Sosa-Escudero
Additional contact information
Leonardo Gasparini: CEDLAS-IIE-FCE-UNLP & CONICET
Walter Sosa-Escudero: UdeSA & CONICET

Authors registered in the RePEc Author Service: Walter Sosa Escudero ()

CEDLAS, Working Papers from CEDLAS, Universidad Nacional de La Plata

Abstract: The ‘paradox of progress’ is an empirical regularity that associates more education with larger income inequality. Two driving and competing factors behind this phenomenon are the convexity of the ‘Mincer equation’ (that links wages and education) and the heterogeneity in its returns, as captured by quantile regressions. We propose a joint least-squares and quantile regression statistical framework to derive a decomposition in order to evaluate the relative contribution of each explanation. The estimators are based on the ‘functional derivative’ approach. We apply the proposed decomposition strategy to the case of Argentina 1992 to 2015.

JEL-codes: C21 I24 J31 J46 O54 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2022-01
New Economics Papers: this item is included in nep-lam, nep-lma and nep-ltv
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Related works:
Working Paper: A decomposition method to evaluate the "paradox of progress", with evidence for Argentina (2021) Downloads
Working Paper: A decomposition method to evaluate the `paradox of progress' with evidence for Argentina (2021) Downloads
Working Paper: A decomposition method to evaluate the 'paradox of progress' with evidence for Argentina (2021) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:dls:wpaper:0293

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