Journal ArticleDOI
An Illustration of a Pitfall in Estimating the Effects of Aggregate Variables on Micro Units
Reads0
Chats0
TLDR
The authors illustrates the danger of spurious regression from this kind of misspecification, using as an example a wage regression estimated on data for individual workers that includes in the specification aggregate regressors for characteristics of geographical states.Abstract:
Many economic researchers have attempted to measure the effect of aggregate market or public policy variables on micro units by merging aggregate data with micro observations by industry, occupation, or geographical location, then using multiple regression or similar statistical models to measure the effect of the aggregate variable on the micro units. The methods are usually based upon the assumption of independent disturbances, which is typically not appropriate for data from populations with grouped structure. Incorrectly using ordinary least squares can lead to standard errors that are seriously biased downward. This note illustrates the danger of spurious regression from this kind of misspecification, using as an example a wage regression estimated on data for individual workers that includes in the specification aggregate regressors for characteristics of geographical states. Copyright 1990 by MIT Press.read more
Citations
More filters
Journal ArticleDOI
Using Cluster Bootstrapping to Analyze Nested Data With a Few Clusters
TL;DR: Results indicate that cluster bootstrapping, though more computationally demanding, can be used as an alternative procedure for the analysis of clustered data when treatment effects at the group level are of primary interest.
Journal ArticleDOI
Import Competition and Firm Refocusing
TL;DR: In this article, the authors examine how import competition affects multi-product firms and find that a rise in imports of core product leads the firm to divest the peripheral products and refocus to the core, and the stronger the complementarities that a peripheral product shares with the core (as measured by the extent of joint sales, joint procurement and joint production), the less likely is the peripheral product to be divested in response to import competition.
Journal ArticleDOI
Alcohol availability and crime: Lessons from liberalized weekend sales restrictions
Hans Grönqvist,Susan Niknami +1 more
TL;DR: Using rich individual level data it is shown that this increase in alcohol availability raised both alcohol use and crime in Sweden.
Journal ArticleDOI
Effects of occupational regulations on the cost of dental services: evidence from dental insurance claims.
Coady Wing,Allison Marier +1 more
TL;DR: This work uses a large database of dental insurance claims to study the effects of occupational regulations on the prevailing prices of a set of basic dental services, and suggests that the task-specific occupational regulations increase prices by about 12%.
Journal ArticleDOI
Asymptotic Theory for Clustered Samples
Bruce E. Hansen,Seojeong Lee +1 more
TL;DR: In this article, the authors provide a complete asymptotic distribution theory for clustered data with a large number of independent groups, generalizing the classic laws of large numbers, uniform laws, central limit theory, and clustered covariance matrix estimation.
References
More filters
Book
Statistical abstract of the United States
TL;DR: The Red River of the North basin of the Philippines was considered a part of the Louisiana Purchase by the United States Department of Commerce in the 1939 Census Atlas of the United Philippines as discussed by the authors.
Journal ArticleDOI
Elements of Econometrics.
Ian Domowitz,Jan Kmenta +1 more
TL;DR: The Elements of Econometrics as mentioned in this paper is a textbook for upper-level undergraduate and master's degree courses and may usefully serve as a supplement for traditional Ph.D. courses in economics.
Book
Elements of econometrics
TL;DR: The emphasis is on simplification whenever possible, assuming the readers know college algebra and basic calculus, and Jan Kmenta explains all methods within the simplest framework, and generalizations are presented as logical extensions of simple cases.
Journal ArticleDOI
Maximum Likelihood Approaches to Variance Component Estimation and to Related Problems
TL;DR: In this paper, the authors proposed a restricted maximum likelihood (reml) approach which takes into account the loss in degrees of freedom resulting from estimating fixed effects, and developed a satisfactory asymptotic theory for estimators of variance components.
Journal ArticleDOI
Random group effects and the precision of regression estimates
TL;DR: The authors analyzes several empirical examples to investigate the applicability of random effects models and the consequences of inappropriately using ordinary least squares (OLS) estimation in the presence of random group effects.