Department of Labor Logo United States Department of Labor
Dot gov

The .gov means it's official.
Federal government websites often end in .gov or .mil. Before sharing sensitive information, make sure you're on a federal government site.


The site is secure.
The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.

Cyclical Aggregation Bias

Michael K. Lettau


The paper estimates the aggregation bias in compensation per hour for the United States, where aggregation bias is defined as the difference over the business cycle between compensation in the typical job and average compensation in the labor market. It compares the Employment Cost Index with the Employer Cost for Employee Compensation, both of which are calculated using the same data from a panel survey of jobs. The results suggest that the aggregation bias is countercyclical, so compensation in the typical job is more procyclical than average compensation in the labor market.