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Dealing With Earnings Bracket Responses In Household Surveys - How Sharp Are Midpoint Imputations?

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  • Dieter Von fintel

Abstract

Earnings functions form the basis of numerous labour market analyses. Non-response (particularly among higher earners) may, however, lead to the exclusion of a significant proportion of South Africa's earnings base. Earnings brackets built into surveys intend to maintain response rates. Econometric tools to incorporate brackets vary from "simplistic" imputation to interval regressions. Coefficient differences are investigated here to establish reliable remedies. Monte-Carlo simulations suggest that "simple" methods fail only under extreme skewness and when a substantial number of right-censored observations appear in the sample. Testing procedures applied to LFS data reveal that in practice coefficients are virtually invariant to the proposed methods. Copyright (c) 2007 The Author; Journal compilation (c) Economic Society of South Africa 2007.

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Bibliographic Info

Article provided by Economic Society of South Africa in its journal South African Journal of Economics.

Volume (Year): 75 (2007)
Issue (Month): 2 (06)
Pages: 293-312

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Handle: RePEc:bla:sajeco:v:75:y:2007:i:2:p:293-312

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Cited by:
  1. Dennis Görlich & Dennis Snower, 2013. "Multitasking and Wages," CESifo Working Paper Series 4307, CESifo Group Munich.
  2. Görlich, Dennis & Snower, Dennis J., 2010. "Wage Inequality and the Changing Organization of Work," Open Access Publications from Kiel Institute for the World Economy 37299, Kiel Institute for the World Economy (IfW).
  3. Vermaark, Claire, 2010. "The Impact of Multiple Imputation of Coarsened Data on Estimates on the Working Poor in South Africa," Working Paper Series wp2010-86, World Institute for Development Economic Research (UNU-WIDER).
  4. Claire Vermaak, 2012. "Tracking poverty with coarse data: evidence from South Africa," Journal of Economic Inequality, Springer, vol. 10(2), pages 239-265, June.
  5. Derek Yu, 2013. "Some factors influencing the comparability and reliability of poverty estimates across household surveys," Working Papers 03/2013, Stellenbosch University, Department of Economics.

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