Decomposition of Inequality By an Extension of the Dinardo-Fortin-Lemieux Method: An Application to an Analysis of Gender Inequality in the Proportion of Managers in Japan
Suppose we denote by C, birth cohorts, by E, the educational attainment, and by D, the employment duration, and the causal order, C→E→D. The decomposition of gender inequality in the proportion of managers by the forward order of equating the conditional distributions of C, E, and D between sexes leads to a sequential application of the DFL method and identifies the effects of C, E, and D including each variable’s indirect effects through causally posterior variables. The decomposition by the backward order of D, E, and C to assess the unique contribution of each covariate’s effect on gender inequality requires an extension of the DFL method, however. This paper demonstrates the usefulness of this extension.