A. Leslie Robb

Alternative Transformations to Handle Extreme Values of the Dependent Variable

Abstract Transformations that could be used to reduce the influence of extreme observations of dependent variables, which can assume either sign, on regression coefficient estimates are studied in this article. Two that seem reasonable on a priori grounds—the extended Box—Cox (BC) and the inverse hyperbolic sine (IHS)—are evaluated in detail. One feature is that the log-likelihood function for IHS is defined for zero values of the dependent variable, which is not true of BC. The double-length regression technique (Davidson and MacKinnon 1984) is used to perform hypothesis tests of one transformation against the other using Canadian data on household net worth. These tests support the use of IHS instead of BC for this data set. Empirical investigators in economics often work with a logged dependent variable (taking the natural logarithm of a data series is, of course, a special case of BC) to reduce the weight their particular estimation procedure might otherwise attach to extreme values of the dependent v...

Gender and the Study of Economics: The Role of Gender of the Instructor

In this paper we explore the question of whether the gender of the instructor in first year university microeconomis might play a role either in the performance of students, and espatially the performance of female students, in microeconomics, or, in the likelihood that student will continue in economics.

Canadian Wage Inequality over the Last Two Decades

We study the dispersion of wages of full-time full-year workers over two decades controlling for both education and experience. Applying non-parametric statistical methods we find statistically significant and large increases in inequality for males with low levels of education and experience coexist with more modest changes in inequality for those with average education and experience, and with actual declines in inequality for older, more experienced workers with a university degree. These relative patterns tend to be similar for females though with a stronger tendency towards inequality in each education-experience category. Given the recent focus in this debate on the issue of polarization, we also show graphs of the actual distributions of wages and analyze these to conclude that the groups experiencing increased dispersion do display what is commonly known as polarization though it would be an exaggeration to claim that the jobs in the middle of the distribution have vanished.

Computing Kernel-Smoothed Conditional Quantiles from Many Observations

Abstract Quantiles of a variable Y conditional on another variable X, when plotted against X, can be a useful descriptive tool. These plots give a quick impression of the functional form of the relation between X and the location, spread, and shape of the conditional distribution of Y. If several Y are observed for each X, then sample quantiles could be calculated for each X. The resulting quantile plot may be quite noisy, however, and smoothing across X may be desired. This article presents an algorithm that calculates kernel-smoothed conditional quantiles with a cross-validation choice of bandwidth for X. It is computationally feasible for large data sets when X assumes a small number of values since it requires only one pass through the full data set. The cross-validation does not require a pass through the data because of simplifications arising from the L 1 loss function being based on absolute values. The technique is illustrated by plotting the conditional quantiles of the net wealth of a sample of...

Socio-economic Influences on the Health of Older Canadians: Estimates Based on Two Longitudinal Surveys

It is well established that there is a positive statistical relationship between socio-economic status (SES) and health, but identifying the direction of causation is difficult. This study exploits the longitudinal nature of two Canadian surveys, the Survey of Labour and Income Dynamics and the National Population Health Survey, to study the link from SES to health (as distinguished from the health-to-SES link). For people aged 50 and older, who are initially in good health, we examine whether changes in health status over the next two to four years are related to prior SES, as represented by income and education. Although the two surveys were designed for different purposes and had different questions for income and health, the evidence they yield with respect to the probability of remaining in good health is similar. Both suggest that SES does play a role and that the differences across SES groups are quantitatively significant, increase with age, and are much the same for men and women.

The response of an industrial firm to alternative electricity rate structures : An optimization model for simulation applications

Abstract A theoretical linear programming model of the response of an industrial firm to hypothetical time-of-use and peak demand electricity rates is presented. The firm minimizes total cost by annual, weekly, and daily production scheduling. It may also change the proportions of energy input supplied by electricity, natural gas, and oil, and in the long run it may expand or contract its plant size. Realistic values are assigned to the parameters of the model and the model is used in simulation experiments to study the effects of alternative electricity rate structures on two types of firm - a ‘light manufacturing’ firm and a ‘heavy manufacturing’ firm. It is found that under certain circumstances the introduction of hypothetical but plausible time-of-use and peak demand rate structures can have a major impact on industrial production schedules, electricity load factors, and other variables of interest.

The Impact of Cost on the Choice of University: Evidence from Ontario

This paper provides the first Canadian study of the link between cost to the student and the choice of university. Over the past two decades, there has been a substantial increase in the differences among Ontario universities in “net cost” defined as tuition and fees minus the expected value to an academically strong student of a guaranteed merit scholarship. Our estimates generally indicate no relationship between net cost and the overall share of strong applicants that a university is able to attract. An increase in net cost is associated with an increase in the ratio of strong students from high income neighborhoods to strong students from middle income and low income neighborhoods in Arts and Science programs but not in Commerce and Engineering. Finally, more advantaged students are more likely to attend university, but merit aid is not of disproportionate benefit to those from more economically advantaged backgrounds given registration.

Persistence and Academic Success in University

Dans cet article, nous examinons, à l’aide d’un ensemble de données couplées, les déterminants de la persévérance et de la réussite scolaires à l’université. Parmi ces déterminants, les notes obtenues au secondaire jouent un rôle nettement plus importants que la nature du programme universitaire, le sexe, l’entourage et les caractéristiques de l’école secondaire fréquentée. Le revenu moyen dans l’entourage et le classement de l’école secondaire fréquentée à des tests standardisés ont ainsi peu de liens avec la réussite à l’université. Ces résultats soulèvent des questions intéressantes sur ce qui permettrait d’expliquer la variation des notes à l’école secondaire et sur la combinaison de facteurs – liés à l’individu, à la famille et à l’école secondaire fréquentée – qui influe sur les résultats à l’université.

Shelter allowances in a general equilibrium setting: A model and some simulations

The tendency for governments to involve themselves in housing markets is widespread. Policies range from minimal direct involvement through the establishment of building codes and zoning bylaws to direct provision of public housing and use of rent controls. One policy that has stirred considerable interest in recent years is that of shelter (or housing) allowances.’ The experience with income maintenance schemes between the mid-1960s and the mid-1970s made analysts and policymakers recognize that people are frequently poorly housed because they have low incomes. Various subsidy and transfer schemes have been proposed to enable the poor to have adequate housing. Such schemes link shelter allowances to rent (or, in some cases, mortgage) payments, to income, or to both. While schemes of this kind are designed to benefit the needy, they also have implications for the housing market, in terms of both quantities of housing services and the prices at which they are sold. Our purpose in this paper is to provide insights into the question of how a large-scale program of shelter allowances for renter households might influence the behavior of those households affected directly, of other households, and of the housing market as a whole. To this end, we construct an analytical framework based on consumer theory and the relevant theory of market behavior. We then design a model within this framework and use the model to explore, by simulation, the likely range of effects of alternative shelter allowance schemes.

Imperfect capital markets in empirical life-cycle models

Abstract In the context of Frisch demand functions that have prices and the marginal utility of income as independent variables, we show how to incorporate imperfect capital markets into empirical models. The analysis is for rational agents in an uncertain world.