Units of Measurement and the Inverse Hyperbolic Sine Transformation
Publikation: Working paper › Forskning
Dokumenter
- Units of Measurement and the Inverse Hyperbolic Sine Transformation
Forlagets udgivne version, 1,08 MB, PDF-dokument
The inverse hyperbolic sine (IHS) transformation is frequently applied in econometric studies to transform right-skewed variables that include zero or negative values. We confirm a previous study that shows that regression results can largely depend on the units of measurement of IHS-transformed variables. Hence, arbitrary choices regarding the units of measurement for these variables can have a considerable effect on recommendations for policies or business decisions. In order to address this problem, we suggest a procedure for choosing units of measurement for IHS-transformed variables. A Monte Carlo simulation assesses this procedure under various scenarios and a replication of the study by Bellemare and Wichman (2019) illustrates the relevance and applicability of our suggested procedure.
Originalsprog | Engelsk |
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Udgiver | Department of Food and Resource Economics, University of Copenhagen |
Antal sider | 20 |
Status | Udgivet - 2019 |
Navn | IFRO Working Paper |
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Nummer | 2019/10 |
Links
- https://econpapers.repec.org/paper/foiwpaper/2019_5f10.htm
Forlagets udgivne version
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