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Misclassification error when identifying job stayers in the Current Population Survey

Author

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  • Chase S. Eck

    (University of Arizona)

Abstract

I evaluate the degree of misclassification error when identifying job stayers in the Current Population Survey using the method proposed by Card and Hyslop (1997). I find that even though their method misclassifies approximately one-third of hourly workers, these errors do not substantially impact estimates of downward nominal wage rigidity, a common application. However, I find that misclassification error influences the results in studies that require estimating the share of the population that are job stayers and changers and their wage changes, such as studies of wage adjustment, and develop a correction for it.

Suggested Citation

  • Chase S. Eck, 2018. "Misclassification error when identifying job stayers in the Current Population Survey," Economics Bulletin, AccessEcon, vol. 38(2), pages 1077-1082.
    • Handle: RePEc:ebl:ecbull:eb-17-00702
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    File URL: http://www.accessecon.com/Pubs/EB/2018/Volume38/EB-18-V38-I2-P104.pdf
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    Cited by:

    1. Jardim, Ekaterina & Solon, Gary & Vigdor, Jacob, 2019. "How Prevalent Is Downward Rigidity in Nominal Wages? Evidence from Payroll Records in Washington State," IZA Discussion Papers 12124, Institute of Labor Economics (IZA).

    More about this item

    Keywords

    wage rigidity; job stayers; CPS; misclassification;
    All these keywords.

    JEL classification:

    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment

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