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Mixed-Effects Methods for Search and Matching Research

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  • John M. Abowd
  • Kevin L. McKinney

Abstract

We study mixed-effects methods for estimating equations containing person and firm effects. In economics such models are usually estimated using fixed-effects methods. Recent enhancements to those fixed-effects methods include corrections to the bias in estimating the covariance matrix of the person and firm effects, which we also consider.

Suggested Citation

  • John M. Abowd & Kevin L. McKinney, 2023. "Mixed-Effects Methods for Search and Matching Research," Papers 2308.15445, arXiv.org.
    • Handle: RePEc:arx:papers:2308.15445
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    References listed on IDEAS

    as
    1. Woodcock, Simon D., 2008. "Wage differentials in the presence of unobserved worker, firm, and match heterogeneity," Labour Economics, Elsevier, vol. 15(4), pages 771-793, August.
    2. Dale T. Mortensen, 2005. "Wage Dispersion: Why Are Similar Workers Paid Differently?," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262633191, April.
    3. John M. Abowd & Robert H. Creecy & Francis Kramarz, 2002. "Computing Person and Firm Effects Using Linked Longitudinal Employer-Employee Data," Longitudinal Employer-Household Dynamics Technical Papers 2002-06, Center for Economic Studies, U.S. Census Bureau.
    4. John M. Abowd & Kevin L. McKinney & Nellie L. Zhao, 2018. "Earnings Inequality and Mobility Trends in the United States: Nationally Representative Estimates from Longitudinally Linked Employer-Employee Data," Journal of Labor Economics, University of Chicago Press, vol. 36(S1), pages 183-300.
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    More about this item

    JEL classification:

    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling

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