Questions tagged [economics]

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0answers
17 views

Do insignificant variables result in a specification error?

I am trying to understand omitted variable bais better. I know that it detects irrelevant variables, but are irrelevant variables and insignificant variables synonymous here? If I have a regression ...
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13 views

How could analyze this type of problem? [closed]

I had a problem the other day where we were asked to estimate the reduction to damage to the road and safety violations from increasing the number of inspectors? I could not think of any good ...
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1answer
40 views

Using Odds Ratio to Calculate Cost Savings

I am looking for some insight in offering some context to my odds ratios. I did a simple model estimating the relationship between the planting space afforded trees and the presence/absence of ...
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20 views

Why does this econ paper include time-invariant demographic measures in a fixed-effect model?

So I'm reading this recently published paper (2020): "Sources of Displaced Workers’ Long- Term Earnings Losses" (American Economic Review), and I'm puzzled why the authors included a "...
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16 views

Alternative for multicollinearity problem

I am a bit unsure how to specify my model and therefore look for some references / ideas. I am interested in a model along the following lines: $pay_i = \alpha + \gamma X_i + \beta pop_i + \epsilon_i ...
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1answer
13 views

Conceptual Question about Effect Size

I have a couple of conceptual questions about Effect Size, hope someone can guide me here. I am told that when I am designing my experiment and I want to establish sample size, I need to specify an ...
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1answer
36 views

How to make conditional quantiles?

I have a dataset consisting two variables X and Y. Both of them are of length 250. Now, I want to make conditional quantiles of X and Y. I have been reading the papers of Koenker and Basset (1978) and ...
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0answers
22 views

Spatial data analysis

I want to use a probit model on the probability of occurrence of a social problem in which one determinant will be location. For this, I have data on locations where the problem is occurring. What ...
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1answer
46 views

Collinearity in dataset, but I don't know why

I am trying to perform a logistic regression with the lm() function in R. My model is: lm(xrd ~ VariableA*Post, data = DatasetXRD), this is a difference-in-differences model, the R code is based on: ...
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2answers
36 views

What kind of econometric models would be appropriate to determine the presence of a causal relationship?

I am conducting some econometric research on the impact of austerity on birth rates in the UK. I would be using publicly available data from the UK government covering the number of births per year, ...
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1answer
12 views

Inputs not proxying for variance, but nevertheless well-correlated

In a summary of this behavioral economics article, it says Our third finding is that cross-consumer heterogeneity in biases is poorly explained by even a “kitchen sink” of other consumer ...
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1answer
34 views

I am a bit confuse about running a regression

I am a bit confuse about running a regression. Independent Variables are as: X1 = Profitability Index X2 = Operational Index X3 = Cost per employee X4 = Leverage Ratio I am confused that can I use ...
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17 views

Calculating adjusted household income

I am analyzing results from a survey (using Stata) where we have a categorical variable from 1 - 12 (ex: 1 = less than 10,000$) that measures annual household income of the particular participant. So ...
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0answers
25 views

Should I use fixed effects or first difference?

I have a panel data which N = 189 and T=3. My dependent variable is growth rate of GDP per capita. I wanted to know which model should I use in this case? Should I use fixed effects or first ...
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1answer
386 views

How to setup data properly for regression analysis to calculate price elasticity?

I am working on a project to try understand Linear Regression a bit deeper (they say experimenting is key and getting lost is part of the process) :( In this project, let's assume I have a watch shop. ...
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0answers
8 views

Question on the choice of boundary in the CUSUM test when we make some resampling [duplicate]

Question on the choice of boundary in the CUSUM test when we make some resampling We are considering to make a CUSUM test for some economical time series $X = (x_1,..,x_n)$. Suppose $X$ contains many ...
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15 views

Which type of regression is appropriate whenever the dependent variable is the saving ratio?

I don't know which regression is best suited to use the saving rate of household income as a dependent variable. The options I have at the moment are Censored Regression (this was brought forward by ...
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0answers
12 views

What is the most suitable classical decomposition model for the time-series graph? [closed]

To decompose time series data using the classical decomposition method, we have additive as well as multiplicative model. What is the most suitable decomposition model to be used to decompose the time ...
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0answers
37 views

Insignificant impulse response functions

Anyone with time series analysis experience? I am building a VAR model with 6 endogenous variables and 3500 observations for each variable (I have used daily frequencies in my time series model). I ...
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0answers
15 views

Should I calculate the real value of net exports using the PPI for a linear regression?

I am using real values for variables such as GDP and Effective exchange rate for my OLS regression I was wondering if I should use the Producer Price index to to find the real value of net exports or ...
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0answers
89 views

2SLS approach using lagged dependent variable as an instrument

I was wondering if the lagged dependent variable can be a valid instrument or not. In my data, policy intervention (x) is made depending on the outcome (y) in the past. (not depending on the effect (b)...
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0answers
26 views

Statistical testing between two time periods to determine a change

I am trying to determine what model to use when testing how an index sector performance changes as we go from environment 1 to environment 2. The environment is based on changes in inflation and is in ...
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0answers
11 views

Calculating relative measures in panel data?

How would I do this in Stata "The relative measure is calculated as the number of standard of deviations the log of total assets of a bank I at time period T deviates from the mean total assets ...
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0answers
18 views

DiD by using a non-time dummy variable - Methodology Issue

I do have a theoretical question about a difference-in-difference (DiD) model I constructed in Stata. Construction: Over a monthly time span of 7 years I try to analyze the impact of investment-volume ...
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2answers
95 views

Calculating sample size with power analysis

I have to calculate the sample size for an experimental study and took some sample distributions data from a previous similar research and calculated the means and standard variations for before and ...
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1answer
1k views

How to test multicollinearity in Fixed Effects Model in R?

I was using plm package in R and run some pooling and fixed effects model. For ...
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1answer
980 views

Using percentage change as a dependent variable?

If I use percentage change as my dependent variable what is the correct modeling method? I am trying to see how the size of a company affects its losses due to COVID-19. I use quarter over quarter ...
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0answers
38 views

Maximum likelihood estimate of rate of relative risk aversion in R fails [closed]

I try to estimate the relative rate of risk aversion gmma of a CRRA function using R. The likelihood maximisation either does not converge or produces an unrealistic estimate. In order to make the ...
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1answer
49 views

Contradicting Single Index model assumptions

http://www.columbia.edu/~gmg2/4706-00/pdf/lect_05nn.pdf In the above paper there is that given the equation of the single index model, Let $x_m$ denote the market index portfolio we have $\bar R_m=...
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0answers
24 views

Can I use logistic regressions and least squares coefficients in a meta-analysis?

I am trying to write a Economics meta-analysis. The papers that I have collected so far contain a 50/50 split between OLS models and Logistic regressions (coefficients reported as odds ratios). If we ...
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0answers
150 views

How would I interpret a dummy variable and interaction term in this time series analysis using ARDL?

I'm doing an econometrics paper analyzing the impacts of oil price shocks on GDP growth. In one of my models, I use change in nominal oil prices, a dummy variable representing negative oil price ...
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0answers
46 views

Behaviour of two variables, where one variable is a ratio of another, in Labour Economics

I am trying to reproduce the result found in an old paper by Harvey S. Rosen, titled "Tax Illusion and the Labor Supply of Married Women Author", using a different dataset. The model that is ...
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0answers
76 views

Create composite index from right skewed data with extreme outliers

Do you have any advice for creating an index from right skewed-data with several extreme outliers. I am new to creating indexes for analysis and could use some advice. So far I've done things like ...
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0answers
195 views

how to model price elasticity

I'm trying to model price elasticity based on price changes and I'm wondering what is the best way to do it. My data is at at the individual customer level and there's a 0/1 indicator for whether they ...
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0answers
16 views

Using ratios and the numerator as explanatory variables in regression analysis with fixed effects

I am running a fixed effects regression analysis with a ratio of number of sellers per capita and the number of sellers as explanatory variable on its own. How should I interpret the results? My ...
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0answers
16 views

What would a suitable justification be to use 'log(exports)' as a dependent variable instead of solely 'exports'? [duplicate]

I am doing a diff-in-diff analysis, looking at whether a regulation had an impact on British pollution-intensive exports. Initially I used 'total exports of pollution-intensive goods' as my dependent ...
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1answer
96 views

Maximum likelihood estimation using R [closed]

I have a multiple linear regression, that I want to estimate using a MLE approach. I would like to make the fit using a Beta distribution, with parameters u and v. How can I do this using R?
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0answers
339 views

What do all the distributions that have the same Gini index have in common?

According to the Wikipedia article about Income inequality metrics, Gini index have the next disadvantage: As a disadvantage, the Gini index only maps a number to the properties of a diagram, but the ...
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0answers
25 views

Unrealistic results in Gpinter

I have tho following wealth tax statistic from which i want to do a Pareto interpolation using gpinter. From this table i have extracted the percentails, their corresponding thresholds and bracket ...
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0answers
15 views

How to control for population change when studying regional employment by sector?

I want to examine regional changes in employment by sector. However some regions have shrinking population and even when the economy is triving, it still shows that employment is falling, but ...