Home > Publications . Search All . Browse All . Country . Browse PSC Pubs . PSC Report Series

PSC In The News

RSS Feed icon

Work by Bailey and Dynarski cited in NYT piece on income inequality

Pfeffer says housing bubble masked decade-long growth in household net worth inequality

House, Burgard, Schoeni et al find that unemployment and recession have contrasting effects on mortality risk

Highlights

Jeff Morenoff makes Reuters' Highly Cited Researchers list for 2014

Susan Murphy named Distinguished University Professor

Sarah Burgard and former PSC trainee Jennifer Ailshire win ASA award for paper

James Jackson to be appointed to NSF's National Science Board

Next Brown Bag


PSC Brown Bags will return in the fall

Implications of Mean-Reverting Measurement Error for Longitudinal Studies of Wages and Employment

Archived Abstract of Former PSC Researcher

Kim, B., and Gary Solon. 2005. "Implications of Mean-Reverting Measurement Error for Longitudinal Studies of Wages and Employment." Review of Economics and Statistics, 87(1): 193-196.

This note examines the implications of mean-reverting measurement error for two influential literatures based on longitudinal survey data: (1) the literature on real wage variation over the business cycle and (2) the literature on intertemporal substitution in labor supply. Accounting for mean-reverting measurement error suggests that real wages may be even more procyclical than indicated by recent longitudinal studies. We also find that the instrumental variables estimator commonly used in intertemporal substitution studies is inconsistent if changes in earnings and hours of work are measured with different degrees of mean reversion, but the magnitude of the resulting inconsistency appears to be small.

DOI:10.1162/0034653053327685 (Full Text)

Browse | Search : All Pubs | Next