Compare methods

	Shapley Decomposition of Inequality	Oaxaca-Blinder Decomposition
Field	Economics	Economics
Family	Process / pipeline	Regression model
Year of origin	2013	1973
Originator	Anthony Shorrocks (working paper 1999; published 2013)	Ronald Oaxaca & Alan Blinder (independently)
Type	Axiomatic decomposition procedure	Regression-based decomposition of a mean outcome gap
Seminal source	Shorrocks, A. F. (2013). Decomposition procedures for distributional analysis: a unified framework based on the Shapley value. Journal of Economic Inequality, 11(1), 99–126.	Oaxaca, R. (1973). Male-female wage differentials in urban labor markets. International Economic Review, 14(3), 693–709.
Aliases	Shapley Decomposition, Shorrocks Shapley Decomposition, Factor Decomposition of Inequality, Shapley Value Distributional Decomposition	Blinder-Oaxaca Decomposition, Wage Gap Decomposition, Threefold Decomposition, Detailed Decomposition
Related	4	2
Summary	The Shapley decomposition, formalized for distributional analysis by Anthony Shorrocks (in a widely circulated 1999 working paper, published in 2013), is a general procedure for attributing an inequality or poverty statistic to its contributing factors — income sources, population subgroups, or determinants. It borrows the Shapley value from cooperative game theory: each factor's contribution is its average marginal effect on the indicator across all possible orders in which factors could be eliminated. The result is an exact, symmetric, residual-free decomposition that applies to any indicator, even those (like the Gini) that have no natural analytic decomposition of their own.	The Oaxaca-Blinder decomposition is a regression-based technique that splits the difference in a mean outcome between two groups — classically the average wage gap between men and women or between racial groups — into a part explained by differences in observable characteristics (endowments such as education and experience) and an unexplained part attributed to differences in how those characteristics are rewarded (the coefficients). Introduced independently by Ronald Oaxaca and Alan Blinder in 1973, it became the standard tool for studying wage discrimination and group disparities.