The frozen-core projector-augmented wave (PAW) method is applied to constru
ct all-electron valence wave Functions from non-norm-conserving pseudo wave
functions and atomic functions. The use of all-electron wave functions pos
sesses the advantage that no nonlocal contributions to the optical transiti
on operator have to be taken into account. Ln addition, the more accurate d
escription of the wave functions in the core region improves the quality of
the calculated spectra compared to those obtained from a pseudopotential a
pproach. We demonstrate the accuracy of the PAW approach by comparing optic
al spectra of several semiconductors with those obtained employing a full a
ll-electron method or norm-conserving pseudopotentials.