Earnings mobility and measurement error
Subtitle: a pseudo-panel approach
By: Francisca Antman, David J. McKenzie, Research working paper Collection Title:Policy.
Contributors: McKenzie, David J.; World Bank.
Series: Policy research working paper ;; 3745; Policy research working papers (Online) ;; 3745.
Publisher: World Bank
Published: 2005
Place of publication: [Washington, D.C
Language: eng
Format: Electronic resource
Subjects: Wages -- Mexico.; Social mobility -- Mexico.; Income distribution -- Mexico.; Labor market -- Mexico.; Equality -- Mexico.
Description: "The degree of mobility in incomes is often seen as an important measure of the equality of opportunity in a society and of the flexibility and freedom of its labor market.  But estimation of mobility using panel data is biased by the presence of measurement error and non-random attrition from the panel.  This paper shows that dynamic pseudo-panel methods can be used to consistently estimate measures of absolute and conditional mobility in the presence of non-classical measurement errors.  These methods are applied to data on earnings from a Mexican quarterly rotating panel.  Absolute mobility in earnings is found to be very low in Mexico, suggesting that the high level of inequality found in the cross-section will persist over time.  However, the paper finds conditional mobility to be high, so that households are able to recover quickly from earnings shocks.  These findings suggest a role for policies which address underlying inequalities in earnings opportunities. "--World Bank web site.
Notes: Includes bibliographical references.
Title from PDF file as viewed on 10/7/2005.
Also available in print.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.