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The Loss in Efficiency from Using Grouped Data to Estimate Coefficients of Group Level Variables

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  • Lang, Kathleen M
  • Gottschalk, Peter

Abstract

We derive the efficiency loss from using grouped data to estimate coefficients of variables that vary across groups but not individuals within a group (e.g., state unemployment rates) when micro data are unavailable on the dependent variable. We present an empirical example of our theoretical results, and show that the efficiency loss in this application is small. Citation Copyright 1996 by Kluwer Academic Publishers.

Suggested Citation

  • Lang, Kathleen M & Gottschalk, Peter, 1996. "The Loss in Efficiency from Using Grouped Data to Estimate Coefficients of Group Level Variables," Computational Economics, Springer;Society for Computational Economics, vol. 9(4), pages 355-361, November.
    • Handle: RePEc:kap:compec:v:9:y:1996:i:4:p:355-61
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    Cited by:

    1. Andreas Beerli & Ronald Indergand & Johannes S. Kunz, 2023. "The supply of foreign talent: how skill-biased technology drives the location choice and skills of new immigrants," Journal of Population Economics, Springer;European Society for Population Economics, vol. 36(2), pages 681-718, April.
    2. John Gardner, 2016. "Immigration and wages: new evidence from the African American Great Migration," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-45, December.

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