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Regression Analysis of Country Effects Using Multilevel Data: A Cautionary Tale

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  • Bryan, Mark L.

    () (University of Essex)

  • Jenkins, Stephen P.

    () (London School of Economics)

Abstract

Cross-national differences in outcomes are often analysed using regression analysis of multilevel country datasets, examples of which include the ECHP, ESS, EU-SILC, EVS, ISSP, and SHARE. We review the regression methods applicable to this data structure, pointing out problems with the assessment of country-level factors that appear not to be widely appreciated, and illustrate our arguments using Monte-Carlo simulations and analysis of women's employment probabilities and work hours using EU SILC data. With large sample sizes of individuals within each country but a small number of countries, analysts can reliably estimate individual-level effects within each country but estimates of parameters summarising country effects are likely to be unreliable. Multilevel (hierarchical) modelling methods are commonly used in this context but they are no panacea.

Suggested Citation

  • Bryan, Mark L. & Jenkins, Stephen P., 2013. "Regression Analysis of Country Effects Using Multilevel Data: A Cautionary Tale," IZA Discussion Papers 7583, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp7583
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    References listed on IDEAS

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    1. Regression Analysis of Country Effects Using Multilevel Data: A Cautionary Tale
      by maximorossi in NEP-LTV blog on 2013-09-25 17:20:31

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    Cited by:

    1. Harms, Philipp & Schwab, Jakob, 2015. "Like it or not? How the Economic and Institutional Environment Shapes Individual Attitudes towards Multinational Enterprises," Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113150, Verein für Socialpolitik / German Economic Association.
    2. Elena Bárcena-Martín & Maria del Carmern & Salvador Perez-Moreno, 2015. "Assessing the impact of social transfer income packages on child poverty. A European cross-national perspective," ThE Papers 15/02, Department of Economic Theory and Economic History of the University of Granada..
    3. Olympia Bover & Jose Maria Casado & Sonia Costa & Philip Du Caju & Yvonne McCarthy & Eva Sierminska & Panagiota Tzamourani & Ernesto Villanueva & Tibor Zavadil, 2016. "The Distribution of Debt across Euro-Area Countries: The Role of Individual Characteristics, Institutions, and Credit Conditions," International Journal of Central Banking, International Journal of Central Banking, vol. 12(2), pages 71-128, June.
    4. repec:eee:finana:v:55:y:2018:i:c:p:209-225 is not listed on IDEAS
    5. Terraneo, Marco, 2015. "Inequities in health care utilization by people aged 50+: Evidence from 12 European countries," Social Science & Medicine, Elsevier, vol. 126(C), pages 154-163.
    6. Hatton, Timothy J., 2014. "Public Opinion on Immigration: Has the Recession Changed Minds?," CEPR Discussion Papers 10008, C.E.P.R. Discussion Papers.
    7. Mario Holzner & Stefan Jestl, 2015. "Of proprietors and proletarians," Working Paper Reihe der AK Wien - Materialien zu Wirtschaft und Gesellschaft 141, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik.
    8. Rashada, Ahmed Shoukry & Sharaf, Mesbah Fathy, 2016. "Income inequality and intimate partner violence against women: Evidence from India," Frankfurt School - Working Paper Series 222, Frankfurt School of Finance and Management.
    9. Perugini, Cristiano & Pompei, Fabrizio, 2016. "Employment protection and wage inequality within education groups in Europe," Journal of Policy Modeling, Elsevier, vol. 38(5), pages 810-836.
    10. Christian Alexander Belabed & Mariya Hake, 2018. "Income inequality and trust in national governments in Central, Eastern and Southeastern Europe," Working Papers 222, Oesterreichische Nationalbank (Austrian Central Bank).
    11. Anindya Bhattacharya & Anirban Kar & Alita Nandi, 2016. "Local institutional structure and clientelistic access to employment: the case of MGNREGS in three states of India," Working papers 269, Centre for Development Economics, Delhi School of Economics.
    12. Rashad, Ahmed & Sharaf, Mesbah, 2017. "Income Inequality and Violence Against Women: Evidence from India," Working Papers 2017-13, University of Alberta, Department of Economics.
    13. Perugini, Cristiano & Žarković Rakić, Jelena & Vladisavljević, Marko, 2016. "Austerity and gender wage inequality in EU countries," MPRA Paper 76306, University Library of Munich, Germany.
    14. Elvin Afandi and Nazim Habibov, 2017. "Pre- and Post-Crisis Trust in Banks: Lessons from Transitional Countries," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 42(1), pages 73-94, March.
    15. repec:spr:jhappi:v:18:y:2017:i:4:d:10.1007_s10902-016-9756-7 is not listed on IDEAS
    16. Stefan Angel, 2016. "The Effect of Over-Indebtedness on Health: Comparative Analyses for Europe," Kyklos, Wiley Blackwell, vol. 69(2), pages 208-227, May.
    17. Perugini, Cristiano & Pompei, Fabrizio, 2017. "Temporary Jobs, Institutions, and Wage Inequality within Education Groups in Central-Eastern Europe," World Development, Elsevier, vol. 92(C), pages 40-59.

    More about this item

    Keywords

    multilevel modelling; cross-national comparisons; country effects;

    JEL classification:

    • C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation, Validation, and Selection
    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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