Consequences of Specification Error for Distributional Analysis with an Application to Intergenerational Mobility
AbstractWe analyze the consequences of three types of specification error for cumulative conditional distribution functions F(y | a) : measurement error in y, in a and omitted conditioning variables. The paper uses exact results to obtain conditions under which the effect of the misspecification on the computed cumulative distribution function can be signed. The effects are shown to depend on both the curvature of the true distribution and the properties of the error distribution. We illustrate our findings using a model of intergenerational mobility.
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Bibliographic InfoPaper provided by Department of Economics, Finance and Accounting, National University of Ireland - Maynooth in its series Economics, Finance and Accounting Department Working Paper Series with number n1110102.
Length: 43 pages
Date of creation: Jan 2002
Date of revision:
Specification Error; Mobility; Conditional Distributions;
Other versions of this item:
- D. O’Neill & O. Sweetman & D. Van De Gaer, 2002. "Consequences of Specification Error for Distributional Analysis With an Application to Intergenerational Mobility," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 02/156, Ghent University, Faculty of Economics and Business Administration.
- C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
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