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Measuring income mobility with dirty data

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  • Cowell, Frank
  • Schluter, Christian

Abstract

We examine the performance of measures of mobility when allowance is made for the possibility of data contamination. We find that “singlestage” indices – those that are applied directly to a sample from a multivariate income distribution – usually prove to be non-robust in the face of contamination. However, “two-stage” models of mobility – where the distribution is first “discretised” into income intervals and then a transition matrix or other tool is applied – may be robust if the first stage if appropriately specified.

Suggested Citation

  • Cowell, Frank & Schluter, Christian, 1998. "Measuring income mobility with dirty data," LSE Research Online Documents on Economics 2079, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:2079
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    File URL: http://eprints.lse.ac.uk/2079/
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    Cited by:

    1. Checchi, Daniele & Ichino, Andrea & Rustichini, Aldo, 1999. "More equal but less mobile?: Education financing and intergenerational mobility in Italy and in the US," Journal of Public Economics, Elsevier, vol. 74(3), pages 351-393, December.
    2. VAN KERM Philippe, 2006. "Comparisons of income mobility profiles," IRISS Working Paper Series 2006-03, IRISS at CEPS/INSTEAD.
    3. Van Kerm, Philippe & Pi Alperin, Maria Noel, 2013. "Inequality, growth and mobility: The intertemporal distribution of income in European countries 2003–2007," Economic Modelling, Elsevier, vol. 35(C), pages 931-939.
    4. Alesina, Alberto & La Ferrara, Eliana, 2005. "Preferences for redistribution in the land of opportunities," Journal of Public Economics, Elsevier, vol. 89(5-6), pages 897-931, June.
    5. Thomas Raferzeder & Rudolf Winter-Ebmer, 2007. "Who is on the rise in Austria: Wage mobility and mobility risk," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 5(1), pages 39-51, April.
    6. VAN KERM Philippe, 2003. "What Lies Behind Income Mobility? Reranking and Distributional Change in Belgium, Western Germany and the USA," IRISS Working Paper Series 2003-03, IRISS at CEPS/INSTEAD.
    7. repec:dau:papers:123456789/4994 is not listed on IDEAS
    8. Felix Büchel & Joachim R. Frick & Asghar Zaidi, 2004. "Income Mobility in Old Age in Britain and Germany," CASE Papers 089, Centre for Analysis of Social Exclusion, LSE.
    9. Philippe Kerm, 2002. "Inference on inequality measures: A Monte Carlo experiment," Journal of Economics, Springer, vol. 77(1), pages 283-306, December.
    10. VAN KERM Philippe, 2002. "On the magnitude of income mobility in Germany," IRISS Working Paper Series 2002-03, IRISS at CEPS/INSTEAD.
    11. Longford, N.T. & Pittau, M.G., 2006. "Stability of household income in European countries in the 1990s," Computational Statistics & Data Analysis, Elsevier, vol. 51(2), pages 1364-1383, November.

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    JEL classification:

    • J1 - Labor and Demographic Economics - - Demographic Economics
    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General

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