IDEAS home Printed from https://ideas.repec.org/a/tpr/restat/v99y2017i2p258-264.html
   My bibliography  Save this article

The Evolution of Rotation Group Bias: Will the Real Unemployment Rate Please Stand Up?

Author

Listed:
  • Alan B. Krueger

    (Princeton University)

  • Alexandre Mas

    (Princeton University)

  • Xiaotong Niu

    (Congressional Budget Office)

Abstract

We document that rotation group bias—the tendency for the unemployment rate to vary systematically by month in sample—in the Current Population Survey (CPS) has worsened over time. Estimated unemployment rates for earlier rotation groups have grown sharply relative to later rotation groups; both should be nationally representative samples. This bias increased discretely after the 1994 CPS redesign, and rising nonresponse rates are likely a significant contributor. Survey nonresponse increased after the redesign, mirroring the evolution of rotation group bias. Consistent with this explanation, rotation group bias for households that responded in all eight interviews remained stable over time.

Suggested Citation

  • Alan B. Krueger & Alexandre Mas & Xiaotong Niu, 2017. "The Evolution of Rotation Group Bias: Will the Real Unemployment Rate Please Stand Up?," The Review of Economics and Statistics, MIT Press, vol. 99(2), pages 258-264, May.
  • Handle: RePEc:tpr:restat:v:99:y:2017:i:2:p:258-264
    as

    Download full text from publisher

    File URL: http://www.mitpressjournals.org/doi/pdf/10.1162/REST_a_00630
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Solon, Gary, 1986. "Effects of Rotation Group Bias on Estimation of Unemployment," Journal of Business & Economic Statistics, American Statistical Association, vol. 4(1), pages 105-109, January.
    2. Daniel Aaronson & Bhashkar Mazumder & Shani Schechter, 2010. "What is behind the rise in long-term unemployment?," Economic Perspectives, Federal Reserve Bank of Chicago, vol. 34(Q II), pages 28-51.
    3. Katharine G. Abraham & Robert Shimer, 2001. "Changes in Unemployment Duration and Labor Force Attachment," NBER Working Papers 8513, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bernhardt, Robert & Wunnava, Phanindra V., 2020. "The CPS Citizenship Question and Survey Refusals: Causal and Semi-Causal Evidence Featuring a Two-Stage Regression Discontinuity Design," IZA Discussion Papers 13350, Institute of Labor Economics (IZA).
    2. Hirsch, Barry & Husain, Muhammad M. & Winters, John V., 2016. "The Puzzling Fixity of Multiple Job Holding across Regions and Labor Markets," IZA Discussion Papers 9631, Institute of Labor Economics (IZA).
    3. Kathrin Ellieroth, 2019. "Spousal Insurance, Precautionary Labor Supply, and the Business Cycle - A Quantitative Analysis," 2019 Meeting Papers 1134, Society for Economic Dynamics.
    4. Jenkins, Stephen P., 2020. "Was the mid-2000s drop in the British job change rate genuine or a survey design effect?," Economics Letters, Elsevier, vol. 194(C).
    5. Fernando Rios-Avila & Gustavo Canavire-Bacarreza, 2020. "The Effect of Immigration on Labor Market Transitions of Native-Born Unemployed in the United States," Journal of Labor Research, Springer, vol. 41(3), pages 295-331, September.
    6. Hie Joo Ahn & James D. Hamilton, 2019. "Measuring Labor-Force Participation and the Incidence and Duration of Unemployment," Finance and Economics Discussion Series 2019-035, Board of Governors of the Federal Reserve System (U.S.), revised 17 May 2019.
    7. Abdullah Almaatouq, 2016. "Complex Systems and a Computational Social Science Perspective on the Labor Market," Papers 1606.08562, arXiv.org.
    8. Rustam Ibragimov & Jihyun Kim & Anton Skrobotov, 2020. "New robust inference for predictive regressions," Papers 2006.01191, arXiv.org, revised Aug 2020.
    9. Fernando Rios-Avila & Gustavo Canavire-Bacarreza, 0. "The Effect of Immigration on Labor Market Transitions of Native-Born Unemployed in the United States," Journal of Labor Research, Springer, vol. 0, pages 1-37.
    10. Ippei Shibata, 2019. "Labor Market Dynamics: A Hidden Markov Approach," IMF Working Papers 19/282, International Monetary Fund.
    11. Walter Distaso & Rustam Ibragimov & Alexander Semenov & Anton Skrobotov, 2020. "COVID-19: Tail Risk and Predictive Regressions," Papers 2009.02486, arXiv.org.
    12. Ori Heffetz & Daniel B. Reeves, 2016. "Difficulty to Reach Respondents and Nonresponse Bias: Evidence from Large Government Surveys," NBER Working Papers 22333, National Bureau of Economic Research, Inc.
    13. Bach, Ruben L. & Eckman, Stephanie, 2020. "Rotation group bias in reporting of household purchases in the U.S. Consumer Expenditure Survey," Economics Letters, Elsevier, vol. 187(C).
    14. Bollinger, Christopher R. & Hirsch, Barry & Hokayem, Charles M. & Ziliak, James P., 2018. "Trouble in the Tails? What We Know about Earnings Nonresponse Thirty Years after Lillard, Smith, and Welch," IZA Discussion Papers 11710, Institute of Labor Economics (IZA).
    15. Mark Borgschulte & Heepyung Cho & Darren Lubotsky, 2019. "Partisanship and Survey Refusal," NBER Working Papers 26433, National Bureau of Economic Research, Inc.

    More about this item

    JEL classification:

    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:tpr:restat:v:99:y:2017:i:2:p:258-264. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ann Olson). General contact details of provider: https://www.mitpressjournals.org/ .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.