Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/49902
Authors: 
Moffitt, Robert
Gottschalk, Peter
Year of Publication: 
2011
Series/Report no.: 
Working papers // the Johns Hopkins University, Department of Economics 578 [rev.]
Abstract: 
We estimate the trend in the transitory variance of male earnings in the U.S. using the Michigan Panel Study of Income Dynamics from 1970 to 2004. Using both an error components model as well as simpler but only approximate methods, we find that the transitory variance started to increase in the early 1970s, continued to increase through the mid-1980s, and then remained at this new higher level through the 1990s and beyond. Thus the increase mostly occurred about thirty years ago. Its increase accounts for between 31 and 49 percent of the total rise in cross-sectional variance, depending on the time period.
Document Type: 
Working Paper

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