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Life-cycle variation in the association between current and lifetime earnings

Author: Steven Haider; Gary Solon; National Bureau of Economic Research.
Publisher: Cambridge, Mass. : National Bureau of Economic Research, 2006.
Series: Working paper series (National Bureau of Economic Research), no. 11943.
Edition/Format:   eBook : Document : EnglishView all editions and formats
Summary:
Abstract: Researchers in a variety of important economic literatures have assumed that current income variables as proxies for lifetime income variables follow the textbook errors-in-variables model. In an analysis of Social Security records containing nearly career-long earnings histories for the Health and Retirement Study sample, we find that the relationship between current and lifetime earnings departs  Read more...
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Material Type: Document, Internet resource
Document Type: Internet Resource, Computer File
All Authors / Contributors: Steven Haider; Gary Solon; National Bureau of Economic Research.
OCLC Number: 63134811
Notes: "January 2006."
Cover title.
Description: 1 online resource (38 pages) : illustrations.
Series Title: Working paper series (National Bureau of Economic Research), no. 11943.
Responsibility: Steven Haider, Gary Solon.

Abstract:

Abstract: Researchers in a variety of important economic literatures have assumed that current income variables as proxies for lifetime income variables follow the textbook errors-in-variables model. In an analysis of Social Security records containing nearly career-long earnings histories for the Health and Retirement Study sample, we find that the relationship between current and lifetime earnings departs substantially from the textbook model in ways that vary systematically over the life cycle. Our results can enable more appropriate analysis of and correction for errors-in-variables bias in a wide range of research that uses current earnings to proxy for lifetime earnings.

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