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Title:Match bias from earnings imputation in the current population survey: the case of imperfect matching PDF Logo
Authors:Bollinger, Christopher R.
Hirsch, Barry T.
Issue Date:2005
Series/Report no.:IZA Discussion Papers 1846
Abstract:This paper examines alternative forms of match bias arising from earnings imputation. Wage equation parameters are estimated based on mixed samples of workers who do and do not report earnings, the latter group being assigned earnings of donors who share some but not all the attributes of the recipients. Regressions that include attributes not used as imputation match criteria (e.g., union status) are severely biased. Related forms of match bias arise with respect to attributes used as match criteria, but matched imperfectly. For example, an imperfect match on schooling creates bias that flattens estimated earnings profiles within low, middle, and high education groups, while creating large jumps in returns across groups. The same pattern arises in wage-age profiles. The paper provides a general analytic expression to correct match bias in regression coefficients under the assumption of conditional mean missing at random. The full sample correction approach is compared to the alternative of omitting imputed earners from the sample, with and without reweighting. Additional problems considered are bias in longitudinal analysis and the presence of dated donors.
Subjects:match bias
imputation
CPS
wage equations
measurement error
JEL:J31
C81
C10
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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