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Is Earnings Nonresponse Ignorable?

Author

Listed:
  • Bollinger, Christopher R.

    (University of Kentucky)

  • Hirsch, Barry

    (Georgia State University)

Abstract
Earnings nonresponse in the Current Population Survey is roughly 30% in the monthly surveys and 20% in the annual March survey. Even if nonresponse is random, severe bias attaches to wage equation coefficient estimates on attributes not matched in the earnings imputation hot deck. If nonresponse is ignorable, unbiased estimates can be achieved by omitting imputed earners, yet little is known about whether or not CPS nonresponse is ignorable. Using sample frame measures to identify selection, we find clear-cut evidence among men but limited evidence among women for negative selection into response. Wage equation slope coefficients are affected little by selection but because of intercept shifts, wages for men and to a lesser extent women are understated, as are gender wage gaps. Selection is less severe among household heads/co-heads than among other household members.

Suggested Citation

  • Bollinger, Christopher R. & Hirsch, Barry, 2010. "Is Earnings Nonresponse Ignorable?," IZA Discussion Papers 5347, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp5347
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    References listed on IDEAS

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    More about this item

    Keywords

    response bias; earnings nonresponse; gender gap; imputation; CPS;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access

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