Is the Consumer Expenditure Survey Representative by Income?
AbstractAggregate under-reporting of household spending in the Consumer Expenditure Survey (CE) can result from two fundamental types of measurement errors: higher-income households (who presumably spend more than average) are under-represented in the CE estimation sample, or there is systematic under-reporting of spending by at least some CE survey respondents. Using a new data set linking CE units to zip-code level average Adjusted Gross Income (AGI), we show that the very highest-income households are less likely to respond to the survey when they are sampled, but unit non-response rates are not associated with income over most of the income distribution. Although increasing representation at the high end of the income distribution could in principle significantly raise aggregate CE spending, the low reported average propensity to spend for higher-income respondent households could account for at least as much of the aggregate shortfall in total spending.
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Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 19589.
Date of creation: Oct 2013
Date of revision:
Publication status: published as John Sabelhaus, David Johnson, Stephen Ash, David Swanson, Thesia Garner, John Greenlees, Steve Henderson. "Is the Consumer Expenditure Survey Representative by Income?," in Christopher Carroll, Thomas Crossley, and John Sabelhaus, editors, "Improving the Measurement of Consumer Expenditures" University of Chicago Press (2013)
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Find related papers by JEL classification:
- C83 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Survey Methods; Sampling Methods
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
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