The Role of Panel Studies in Research on Economic Behavior

The analytic and monetary costs and benefits of panel surveys are assessed in light of experiences from the Panel Study of Income Dynamics, an l&year panel swey on the economic status and behavior of the U.S. population. The analytic benefits of panel are formidable, ranging from description of gross change to various analytic advantages of continuous and discrete time modelling. Analytic costs such as the conditioning of responses in subsequent participation or nonresponse bias are possible in panel surveys, but their effects can be minimized with proper data collection procedures and analytic adjustments. Surprisingly, the monetary costs of panel surveys are less than the costs of comparable repeated cross-sectional surveys.