Sullivan, Paul (2007): Estimation of an Occupational Choice Model when Occupations are Misclassified.
This is the latest version of this item.
Download (1MB) | Preview
This paper examines occupational choices using a discrete choice model that accounts for the fact that self-reported occupation data is measured with error. Despite evidence from validation studies which suggests that there is a substantial amount of measurement error in self-reported occupations, existing research has not corrected for classification error when estimating models of occupational choice. This paper develops a panel data model of occupational choices that corrects for misclassification in occupational choices and measurement error in occupation-specific work experience variables. The model is used to estimate the extent of measurement error in self-reported occupation data and quantify the bias that results from ignoring measurement error in occupation codes when studying the determinants of occupational choices and estimating the effects of occupation-specific human capital on wages. The parameter estimates reveal that 9% of occupational choices in the 1979 cohort of the National Longitudinal Survey of Youth are misclassified. Ignoring misclassification biases the median parameter in the occupational choice model by 25%.
|Item Type:||MPRA Paper|
|Institution:||Bureau of Labor Statistics|
|Original Title:||Estimation of an Occupational Choice Model when Occupations are Misclassified|
|Keywords:||occupational choice; misclassification; simulation methods|
|Subjects:||C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables > C25 - Discrete Regression and Qualitative Choice Models ; Discrete Regressors ; Proportions ; Probabilities
J - Labor and Demographic Economics > J2 - Demand and Supply of Labor > J24 - Human Capital ; Skills ; Occupational Choice ; Labor Productivity
C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods and Methodology: General > C15 - Statistical Simulation Methods: General
|Depositing User:||Paul Sullivan|
|Date Deposited:||26. Jun 2008 02:22|
|Last Modified:||08. Aug 2015 12:39|
Abowd, John and Arnold Zellner (1985). "Estimating Gross Labor Force Flows." Journal of Business and Economic Statistics, v. 3: 254-283.
Abrevaya, Jason and Jerry Hausman (1999). "Semiparametric Estimation with Mismeasured Dependant Variables: An Application to Duration Models for Unemployment Spells." Annales D'Economie Et De Statistique, v. 55: 243-275.
Bollinger, Chris (1996). "Bounding Mean Regressions when a Binary Regressor is Mismeasured." Journal of Econometrics, v. 73: 387-399.
Bound, John, Charles Brown, and Nancy Mathiowetz (2001). "Measurement Error in Survey Data." In Handbook of Econometrics, edited by E. Learner and J. Heckman. Pp. 3705-3843. New York: North Holland Publishing.
Chen, Xiaohong, Han Hong, and Elie Tamer (2005). "Measurement Error Models with Auxiliary Data." The Review of Economic Studies, v. 72: 343-366.
Chua, Tin Chiu and Wayne Fuller (1987). "A Model for Multinomial Response Error Applied to Labor Flows." Journal of the American Statistical Association, v. 82: 46-51.
Douglas, Stratford, Karen Smith Conway, and Gary Ferrier (1995). "A Switching Frontier Model for Imperfect Sample Separation Information: with an Application to Constrained Labor Supply." International Economic Review, v. 36 no. 2, pp. 503-526.
Dustmann, Christian and Arthur van Soest (2001). "Language Fluency and Earnings: Estimation with Misclassified Language Indicators." The Review of Economics and Statistics, v. 83, no. 4: 663-674.
Geweke, John (1991). "Efficient Simulation from the Multivariate Normal and Student-t Distributions Subject to Linear Constraints." Computer Science and Statistics: Proceedings of the Twenty-Third Symposium on the Interface, pp. 571-578.
Gould, Eric (2002). "Rising Wage Inequality, Comparative Advantage, and the Growing Importance of General Skills In the United States." Journal of Labor Economics, v. 20, no. 1: pp. 105-147.
Hajivassiliou, Vassilis (1990). "Smooth Simulation Estimation of Panel Data LDV Models." Manuscript, Yale University.
Hausman, Jerry, Jason Abrevaya, and Fiona Scott-Morton (1998). "Misclassification of the Dependant Variable in a Discrete-Response Setting." Journal of Econometrics, v. 87.
Heckman, James, and Guilherme Sedlacek (1985). "Heterogeneity, Aggregation, and Market Wage Functions: An Empirical Model of Self Selection in the Labor Market." Journal of Political Economy, v. 93: 1077-1125.
Heckman, James, and Guilherme Sedlacek (1990). "Self-Selection and the Distribution of Hourly Wages." Journal of Labor Economics, v. 8, no. 1: S329-S363.
H+ : Heckman, James, and Burton Singer (1984). "A Method for Minimizing the Impact of Distributional Assumptions in Econometric Models for Duration Data." Econometrica, v. 52: 271-320.
Kambourov, Gueorgui and Iorii Manovskii (2006). "Occupational Specificity of Human Capital." Working Paper.
Keane, Michael (1994). "A Computationally Practical Simulation Estimator for Panel Data." Econometrica, v. 62, no. 1: 95-116.
Keane, Michael, and Kenneth Wolpin (1997). "The Career Decisions of Young Men." Journal of Political Economy, v. 105 : 474-521.
Kreider, Brent and John Pepper (2004A). "Disability and Employment: Reevaluating the Evidence in Light of Reporting Errors." Working paper.
Kreider, Brent and John Pepper (2004B). "Inferring Disability Status from Corrupt Data." Working paper.
Krueger, Alan and Lawrence Summers (1988). "Efficiency Wages and Inter-Industry Wage Structure." Econometrica v. 56, no. 2: 259-293.
Lavy, Victor, Michael Palumbo and Steven Stern (1998). "Simulation of Multinomial Probit Probabilities and Imputation of Missing Data." In Advances in Econometrics, edited by T. Fomby and C. Hill. JAI Press.
Li, Tong, Pravin Trivedi, and Jiequn Guo (2003). "Modeling Response Bias in Count: A Structural Approach with an Application to the National Crime Victimization Survey Data." Sociological Methods and Research, v. 31, no. 4: 514-544.
Magnac, Thierry and Michael Visser (1999). "Transition Models with Measurement Errors." The Review of Economics and Statistics, v. 81, no. 3: 466-474.
Mathiowetz, Nancy (1992). "Errors in Reports of Occupation." The Public Opinion Quarterly, v. 56, no. 3: 352-355.
McCall, Brian (1990). "Occupational Matching: A Test of Sorts." Journal of Political Economy, v. 98: 45-69.
Mellow, Wesley and Hal Sider (1983). "Accuracy of Response in Labor Market Surveys: Evidence and Implications." Journal of Labor Economics, v. 1, no. 4: 331-344.
Mroz, Thomas (1999). "Discrete Factor Approximations in Simultaneous Equation Models: Estimating the Impact of a Dummy Endogenous Variable on a Continuous Outcome." Journal of Econometrics, v. 92, no. 2: 233-274.
Neal, Derek (1995). "Industry Specific Human Capital: Evidence from Displaced Workers." Journal of Labor Economics, v. 13, no. 4.
Neal, Derek (1999). "The Complexity of Job Mobility Among Young Men." Journal of Labor Economics, v. 17, No. 2.
Parent, Daniel (2000). "Industry Specific Capital and the Wage Profile: Evidence from the National Longitudinal Survey of Youth and the Panel Study of Income Dynamics." Journal of Labor Economics, v. 18, no. 2.
Poterba, James and Lawrence Summers (1995). "Unemployment Benefits and Labor Market Transitions: A Multinomial Logit Model with Errors in Classification." The Review of Economics and Statistics, v. 77, no. 2: 207-216.
Ramalho, Esmeralda (2002). "Regression models for choice-based samples with misclassification in the response variable." Journal of Econometrics, v. 106: 171-201.
Roy, Andrew (1951). "Some Thoughts on the Distribution of Earnings." Oxford Economic Papers, v. 3: 135-146.
Stinebrickner, Todd (1999). "Estimation of a Duration Model in the Presence of Missing Data." The Review of Economics and Statistics, v. 81, no. 3: 529-542.
Stinebrickner, Ralph and Todd Stinebrickner (2004). "Time Use and College Outcomes." Journal of Econometrics v. 121: 243-269.
Available Versions of this Item
Estimation of an Occupational Choice Model when Occupations are Misclassified. (deposited 17. Nov 2006)
- Estimation of an Occupational Choice Model when Occupations are Misclassified. (deposited 26. Jun 2008 02:22) [Currently Displayed]