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Match Bias from Earnings Imputation in the Current Population Survey: The Case of Imperfect Matching

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  • Christopher R. Bollinger

    (University of Kentucky)

  • Barry T. Hirsch

    (Trinity University)

Abstract

This article examines match bias arising from earnings imputation. Wage equation parameters are estimated from mixed samples of workers reporting and not reporting earnings, the latter assigned earnings of donors. Regressions including attributes not used as imputation match criteria (e.g., union) are severely biased. Match bias also arises with attributes used as match criteria but matched imperfectly. Imperfect matching on schooling (age) flattens earnings profiles within education (age) groups and creates jumps across groups. Assuming conditional missing at random, a general analytic expression correcting match bias is derived and compared to alternatives. Reweighting a respondent-only sample proves an attractive approach.

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Bibliographic Info

Article provided by University of Chicago Press in its journal Journal of Labor Economics.

Volume (Year): 24 (2006)
Issue (Month): 3 (July)
Pages: 483-520

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Handle: RePEc:ucp:jlabec:v:24:y:2006:i:3:p:483-520

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Citations

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Cited by:
  1. Rodriguez-Oreggia, Eduardo & Lopez-Videla, Bruno, 2014. "Imputación de ingresos laborales: Una aplicación con encuestas de empleo en México
    [Labor earnings imputation: An application using labor surveys in Mexico]
    ," MPRA Paper 54436, University Library of Munich, Germany.
  2. Emily Isenberg & Liana Christin Landivar & Esther Mezey, 2013. "A Comparison Of Person-Reported Industry To Employer-Reported Industry In Survey And Administrative Data," Working Papers 13-47, Center for Economic Studies, U.S. Census Bureau.
  3. William E. Even & David A. Macpherson, 2012. "Is Bigger Still Better? The Decline of the Wage Premium at Large Firms," Southern Economic Journal, Southern Economic Association, vol. 78(4), pages 1181-1201, April.
  4. Bollinger, Christopher R. & Hirsch, Barry, 2010. "Is Earnings Nonresponse Ignorable?," IZA Discussion Papers 5347, Institute for the Study of Labor (IZA).
  5. Orrenius, Pia M. & Zavodny, Madeline, 2014. "How do e-verify mandates affect unauthorized immigrant workers?," Working Papers 1403, Federal Reserve Bank of Dallas.
  6. Hirsch, Barry & Schumacher, Edward J., 2008. "Underpaid or Overpaid? Wage Analysis for Nurses Using Job and Worker Attributes," IZA Discussion Papers 3833, Institute for the Study of Labor (IZA).
  7. Barry T. Hirsch, 2008. "Sluggish Institutions in a Dynamic World: Can Unions and Industrial Competition Coexist?," Journal of Economic Perspectives, American Economic Association, vol. 22(1), pages 153-176, Winter.
  8. James T. Bang & Aniruddha Mitra, 2009. "Brain Drain and Institutions of Governance: Educational Attainment of Immigrants to the US 1988-2000," Middlebury College Working Paper Series 0919, Middlebury College, Department of Economics.
  9. Hirsch, Barry, 2013. "An Anatomy of Public Sector Unions," IZA Discussion Papers 7313, Institute for the Study of Labor (IZA).
  10. Molly Dahl & Thomas DeLeire & Shannon Mok, 2012. "Food Insufficiency and Income Volatility in U.S. Households: The Effects of Imputed Earnings in the Survey of Income and Program Participation: Working Paper 2012-07," Working Papers 43137, Congressional Budget Office.
  11. Ziliak, James P. & Hardy, Bradley & Bollinger, Christopher, 2011. "Earnings volatility in America: Evidence from matched CPS," Labour Economics, Elsevier, vol. 18(6), pages 742-754.
  12. Nakabayashi, Masaki, 2011. "Schooling, employer learning, and internal labor market effect: Wage dynamics and human capital investment in the Japanese steel industry, 1930-1960s," MPRA Paper 30749, University Library of Munich, Germany, revised 06 May 2011.
  13. Klapper, Leora & Lusardi, Annamaria & Panos, Georgios A., 2013. "Financial literacy and its consequences: Evidence from Russia during the financial crisis," Journal of Banking & Finance, Elsevier, vol. 37(10), pages 3904-3923.
  14. Scotton, Carol R. & Taylor, Laura O., 2011. "Valuing risk reductions: Incorporating risk heterogeneity into a revealed preference framework," Resource and Energy Economics, Elsevier, vol. 33(2), pages 381-397, May.
  15. Seik Kim, . "Economic Assimilation of Foreign-Born Workers in the United States: An Overlapping Rotating Panel Analysis," Working Papers UWEC-2008-19, University of Washington, Department of Economics.
  16. Liu, Long, 2009. "On hourly wages and weekly earnings in the current population survey," Economics Letters, Elsevier, vol. 105(1), pages 113-116, October.
  17. Christopher R. Bollinger & Barry T. Hirsch, 2010. "GDP & Beyond – die europäische Perspektive," Working Paper Series of the German Council for Social and Economic Data 165, German Council for Social and Economic Data (RatSWD).

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