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An Illustration of a Pitfall in Estimating the Effects of Aggregate Variables on Micro Units
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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
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The External Effects of Black Male Incarceration on Black Females
TL;DR: This paper examined how the increase in the incarceration of black men and the sex ratio imbalance it induces shape the behavior of young black women and found that black male incarceration lowers the odds of black non-marital teenage fertility while increasing young women's school attainment and early employment, which can explain the sharp bridging of the racial gap over the 1990s for a range of socioeconomic outcomes among females.
Journal ArticleDOI
Robust standard error estimators for panel models: a unifying approach
TL;DR: A framework based on high-level wrapper functions for most common usage and basic computational elements to be combined at will, coupling user-friendliness with flexibility, is integrated in the plm package for panel data econometrics in R.
Journal ArticleDOI
Improving or Disappearing: Firm-Level Adjustments to Minimum Wages in China
TL;DR: In this article, the authors consider how Chinese firms react to higher minimum wages, exploiting the 2004 minimum-wage reform in China and find that the wage costs for surviving firms that were more exposed to minimum wage hikes rose, but also that their productivity significantly improved, allowing them to absorb the cost shock without any change in their profitability and with limited job losses.
Posted Content
Rent-Sharing under Different Bargaining Regimes: Evidence from Linked Employer-Employee Data
Michael Rusinek,François Rycx +1 more
TL;DR: In this article, the authors use unique linked employer-employee data from a 2003 survey in Belgium to examine how these bargaining features affect the extent of rent-sharing, and they find that there is substantially more rent sharing in decentralized than in centralized industries, even when controlling for the endogeneity of profits, for heterogeneity among workers and firms and for differences in characteristics between bargaining regimes.
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A natural experiment in school accountability: The impact of school performance information on pupil progress
TL;DR: In this paper, the authors test the hypothesis that the publication of school performance tables raises school effectiveness and find significant and robust evidence that this reform markedly reduced school effectiveness in Wales, and also test whether the reform reduced school segregation in Wales.
References
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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.
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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.