Earnings Mobility And Measurement Error : A Pseudo-Panel Approach / Francisca Antman Antman, Francisca

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Author
Antman, Francisca
Subjects
Wages - Mexico - Econometric models.; Equality - Mexico - Econometric models.; Social mobility - Mexico - Econometric models.
Summary
"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.
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http://trove.nla.gov.au/work/255929
Work ID
255929

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