Abstract

This paper examines occupational choices using a discrete choice model that accounts for the fact that self-reported occupation data is measured with error. Despite evidence from validation studies which suggests that there is a substantial amount of measurement error in self-reported occupations, existing research has not corrected for classi…cation error when estimating models of occupational choice. This paper develops a panel data model of occupational choices that corrects for misclassi…cation in occupational choices and measurement error in occupation-speci…c work experience variables. The model is used to estimate the extent of measurement error in self-reported occupation data and quantify the bias that results from ignoring measurement error in occupation codes when

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