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Estimation of an Occupational Choice Model when Occupations are Misclassified

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  • Paul Sullivan

Abstract

This paper develops an empirical occupational choice model that corrects for misclassification in occupational choices and measurement error in occupation-specific work experience. The model is used to estimate the extent of measurement error in occupation data and quantify the bias that results from ignoring measurement error in occupation codes when studying the determinants of occupational choices and estimating the effects of occupation-specific human capital on wages. The parameter estimates reveal that 9 percent of occupational choices in the 1979 cohort of the NLSY are misclassified. Ignoring misclassification leads to biases that affect the conclusions drawn from empirical occupational choice models.

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Article provided by University of Wisconsin Press in its journal Journal of Human Resources.

Volume (Year): 44 (2009)
Issue (Month): 2 ()
Pages:

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Handle: RePEc:uwp:jhriss:v:44:y:2009:i2:p495-535

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Citations

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Cited by:
  1. Shintaro Yamaguchi, 2009. "Formation of Heterogeneous Skills and Wage Growth," Department of Economics Working Papers 2009-13, McMaster University.
  2. Shintaro Yamaguchi, 2012. "Tasks and Heterogeneous Human Capital," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 30(1), pages 1 - 53.
  3. Barbara Mueller & Juerg Schweri, 2012. "The returns to occupation-specific human capital - Evidence from mobility after training," Economics of Education Working Paper Series, University of Zurich, Institute for Strategy and Business Economics (ISU) 0081, University of Zurich, Institute for Strategy and Business Economics (ISU).
  4. Arndt Werner & Johanna Gast & Sascha Kraus, 2014. "The effect of working time preferences and fair wage perceptions on entrepreneurial intentions among employees," Small Business Economics, Springer, Springer, vol. 43(1), pages 137-160, June.
  5. Yamaguchi, Shintaro, 2010. "The effect of match quality and specific experience on career decisions and wage growth," Labour Economics, Elsevier, Elsevier, vol. 17(2), pages 407-423, April.
  6. Sullivan, Paul, 2010. "Empirical evidence on occupation and industry specific human capital," Labour Economics, Elsevier, Elsevier, vol. 17(3), pages 567-580, June.

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