He said, she said: The gender wage gap according to self and proxy reports in the Current Population Survey

Roughly half the labor force data in the Current Population Survey (CPS) are provided by proxy respondents, and since 1979, men’s reliance on proxies has dropped dramatically while women’s reliance on proxies has increased. Few authors, however, have examined how combining these first-hand and second-hand reports may influence our understanding of long-term economic trends. We exploit the outgoing rotation group structure of the CPS by matching individual records one year apart, and we find that self-reported wages are higher than proxy-reported wages even after controlling for all time invariant characteristics. Furthermore, we find that changes in the use of proxy respondents by men and women since 1979 have made current estimates of the gender wage gap larger than they would have been without changes in reporting status. This suggests that the gender wage gap has closed more than previously estimated. We recommend that researchers combine self and proxy responses with great care, especially when analyzing time trends or making gender comparisons.