TY  - JOUR
AU  - Lillard,Lee A.
AU  - Willis,Robert J.
TI  - Dynamic Aspects of Earnings Mobility
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 150
PY  - 1976
Y2  - September 1976
UR  - http://www.nber.org/papers/w0150
L1  - http://www.nber.org/papers/w0150.pdf
N1  - Author contact info:
Robert J. Willis
3254 ISR
University of Michigan
P. O. Box 1248
426 Thompson Street
Ann Arbor, MI 48106
Tel: 734/936-0314
E-Mail: rjwillis@isr.umich.edu
AB  - This paper proposes an econometric methodology to deal with life cycle earnings and mobility among discrete earnings classes. First, we use panel data on male log earnings to estimate an earnings function with permanent and serially correlated transitory components due to both measured and unmeasured variables. Assuming that the error components are normally distributed, we develop statements for the probability that an individual's earnings will fall into a particular but arbitrary time sequence of poverty states. Using these statements, we illustrate the implications of our earnings model for poverty dynamics and compare our approach to Markov chain models of income mobility.
ER  -