Empirical Strategies to Eliminate Life-Cycle Bias in the Intergenerational Elasticity of Earnings Literature
AbstractI argue that the empirical strategies for estimation of the intergenerational elasticity of lifetime earnings that are currently employed in the literature might not eliminate bias arising from life-cycle effects. Specifically, I demonstrate that procedures based on the generalized errors-in-variables model suggested by Haider and Solon (2006) or the consideration of differential earnings growth rates across subpopulations may not yield unbiased or consistent estimates. I further argue that instrumental variable estimators will not identify an upper bound for the true population parameter.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 5245.
Length: 33 pages
Date of creation: Oct 2010
Date of revision:
Contact details of provider:
Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Other versions of this item:
- Jan Leonard Stuhler, 2010. "Empirical Strategies to Eliminate Life-Cycle Bias in the Intergenerational Elasticity of Earnings Literature," SOEPpapers on Multidisciplinary Panel Data Research 346, DIW Berlin, The German Socio-Economic Panel (SOEP).
- J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
- C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-11-06 (All new papers)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Björklund, Anders & Jäntti, Markus & Lindquist, Matthew J., 2007.
"Family Background and Income during the Rise of the Welfare State: Brother Correlations in Income for Swedish Men Born 1932-1968,"
IZA Discussion Papers
3000, Institute for the Study of Labor (IZA).
- Björklund, Anders & Jäntti, Markus & Lindquist, Matthew J., 2009. "Family background and income during the rise of the welfare state: Brother correlations in income for Swedish men born 1932-1968," Journal of Public Economics, Elsevier, vol. 93(5-6), pages 671-680, June.
- María Cervini Plá, 2009. "Measuring intergenerational earnings mobility in Spain: A selection-bias-free," Working Papers wpdea0904, Department of Applied Economics at Universitat Autonoma of Barcelona.
- Björklund, Anders & Lindahl, Mikael & Plug, Erik, 2005.
"The Origins of Intergenerational Associations: Lessons from Swedish Adoption Data,"
IZA Discussion Papers
1739, Institute for the Study of Labor (IZA).
- Anders Björklund & Mikael Lindahl & Erik Plug, 2006. "The Origins of Intergenerational Associations: Lessons from Swedish Adoption Data," The Quarterly Journal of Economics, MIT Press, vol. 121(3), pages 999-1028, 08.
- Nilsen, Øivind Anti & Vaage, Kjell & Aakvik, Arild & Jacobsen, Karl, 2008. "Estimates of Intergenerational Elasticities Based on Lifetime Earnings," IZA Discussion Papers 3709, Institute for the Study of Labor (IZA).
- Manudeep Bhuller & Magne Mogstad & Kjell G.Salvanes, 2011.
"Life-cycle bias and the returns to schooling in current and lifetime earnings,"
666, Research Department of Statistics Norway.
- Bhuller, Manudeep & Mogstad, Magne & Salvanes, Kjell G., 2011. "Life-Cycle Bias and the Returns to Schooling in Current and Lifetime Earnings," IZA Discussion Papers 5788, Institute for the Study of Labor (IZA).
- Nybom, Martin & Stuhler, Jan, 2011. "Heterogeneous Income Profiles and Life-Cycle Bias in Intergenerational Mobility Estimation," IZA Discussion Papers 5697, Institute for the Study of Labor (IZA).
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).
If references are entirely missing, you can add them using this form.