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The role of low earnings in differing trends in male earnings volatility

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  • Carr, Michael D.
  • Wiemers, Emily E.
Abstract
Trends in male earnings volatility vary across studies. Volatility is flat or increasing in most studies using survey data but falling in recent studies using administrative data. This paper uses Survey of Income and Program Participation data linked to administrative earnings histories from the Detailed Earnings Records to investigate the effect of the treatment of low earnings on earnings volatility. We show that volatility trends are sensitive to the treatment of low earnings: when low earnings are treated as is typically done with survey data, volatility is flat or increasing slightly, but when low earnings are treated as in recent studies using administrative earnings data, volatility declines.

Suggested Citation

  • Carr, Michael D. & Wiemers, Emily E., 2021. "The role of low earnings in differing trends in male earnings volatility," Economics Letters, Elsevier, vol. 199(C).
    • Handle: RePEc:eee:ecolet:v:199:y:2021:i:c:s0165176520304626
    DOI: 10.1016/j.econlet.2020.109702
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    References listed on IDEAS

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    1. Celik Sule & Juhn Chinhui & McCue Kristin & Thompson Jesse, 2012. "Recent Trends in Earnings Volatility: Evidence from Survey and Administrative Data," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 12(2), pages 1-26, June.
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    5. Michael D. Carr & Emily E. Wiemers, 2018. "New Evidence on Earnings Volatility in Survey and Administrative Data," AEA Papers and Proceedings, American Economic Association, vol. 108, pages 287-291, May.
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    9. Robert Moffitt & Sisi Zhang, 2022. "Estimating Trends in Male Earnings Volatility with the Panel Study of Income Dynamics," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 41(1), pages 20-25, December.
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    12. Jason DeBacker & Bradley Heim & Vasia Panousi & Shanthi Ramnath & Ivan Vidangos, 2013. "Rising Inequality: Transitory or Persistent? New Evidence from a Panel of U.S. Tax Returns," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 44(1 (Spring), pages 67-142.
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    15. James P. Ziliak & Charles Hokayem & Christopher R. Bollinger, 2022. "Trends in Earnings Volatility Using Linked Administrative and Survey Data," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 41(1), pages 12-19, December.
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    Cited by:

    1. Robert Moffitt & John Abowd & Christopher Bollinger & Michael Carr & Charles Hokayem & Kevin McKinney & Emily Wiemers & Sisi Zhang & James Ziliak, 2022. "Reconciling Trends in U.S. Male Earnings Volatility: Results from Survey and Administrative Data," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 41(1), pages 1-11, December.
    2. Richard Blundell & Christopher R. Bollinger & Charles Hokayem & James P. Ziliak, 2024. "Interpreting Cohort Profiles of Lifecycle Earnings Volatility," Working Papers 24-21, Center for Economic Studies, U.S. Census Bureau.

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    More about this item

    Keywords

    Volatility; Administrative data; SIPP GSF;
    All these keywords.

    JEL classification:

    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs

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