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Ronald Oaxaca is the McClelland Professor of Economics and faculty associate at the Economics Science Laboratory at the University of Arizona. Best known to many economists as the developer of the Oaxaca wage decomposition technique for examining wage differentials, he has conducted research and published extensively since the 1970s on topics such as labor economics, applied econometrics, and applied microeconomics including sex, union, and race differentials and discrimination; unemployment and unemployment insurance; and the minimum wage.
Oaxaca is perhaps best known for developing one of the most important methods used in the field of labor economics to study wage discrimination based on sex and race known as the wage gap decomposition, which he outlined in his 1973 article “Male-Female Wage Differentials in Urban Labor Markets.” Also influenced by economist Alan S. Blinder, the wage gap decomposition provides a means for identifying residual differences between observed and predicted wages that are not accounted for by characteristics associated with productivity, such as education and skill, and can thus be attributed to labor market discrimination and other omitted variables. The seminal method has since been refined and elaborated upon to add other elements of analysis, such as the use of alternative wage structures as reference points for comparison; selectivity bias; comparative analysis across countries and time; the explanation of penalties associated with motherhood; and analysis of discrimination across the income distribution rather than using means. Oaxaca has also continued to utilize and improve upon the wage decomposition, notably with Michael R. Ransom in two studies conducted in 1994 and 1999 (as mentioned in Yana van der Meulen Rodgers’s 2006 article “A Primer on Wage Gap Decompositions in the Analysis of Labor Market Discrimination”), further refining methods for developing the nondiscriminatory wage structure and emphasizing the importance of the reference group for estimating the unexplained or discriminatory portion of the wage gap.
More recently Oaxaca has focused on topics such as the influences of ability and family background on optimal schooling levels; the effects of dual job holding; statistical discrimination; and consistent estimators of linear probability models. His continued study of gender differentials in wages includes work to examine the impact of technology and to compare trends in the United States and Denmark. Further he is conducting research on such disparate subjects as determinants of faculty salaries, the production of engineering degrees, optimal sick pay schemes, gender bias in the criminal justice system, and measurement error in work experience. He currently serves as the coeditor of American Economic Review, and he is on the editorial board of the Journal of Economic Inequality. From 1986 to 1989 he was on the editorial board of the Journal of Urban Economics, and he previously coedited Economic Inquiry. To date he has published over seventy articles, working papers, and book reviews.
Oaxaca is also a teacher who has been a member of over seventy thesis committees since 1978. He joined the faculty of the University of Arizona in 1976 (after teaching at the University of Massachusetts from 1973 to 1976) and has been a visiting professor at a number of institutions, including Smith College (1975); Princeton University (1982); Stanford University (1983–1984); New Mexico State University (1991), where he was a Distinguished Visiting Professor; the University of Aarhus in Denmark (1997); and ERMES at the University of Paris II (2003). He is an active member of the Association for Hispanic Economists.
Oaxaca was a fellow of the Udall Center at the University of Arizona from 1995 to 1996 and since 2001 has been a research fellow at the Institute for the Study of Labor (IZA) in Bonn, Germany. In 2005 Hispanic Business magazine selected Oaxaca to appear on the list of the 100 most influential Hispanics.
Oaxaca earned a bachelor’s of science (summa cum laude with honors) from California State University at Fresno (1965) and a master’s (1969) and doctorate (1971) in economics from Princeton University.
- Oaxaca, Ronald 1973. Male-Female Wage Differentials in Urban Labor Markets. International Economic Review 14 (3): 693–709.
- Rodgers, Yana van der M 2006. A Primer on Wage Gap Decompositions in the Analysis of Labor Market Discrimination. In Handbook on the Economics of Discrimination, ed. William M. Rodgers, III. Cheltenham, UK: E. Elgar Publishing.
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