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An alternative method to estimate income variance in cross-sectional data

Hiroki Uematsu, Ashok Kumar Mishra and Rebekah Rachel Powell

Applied Economics Letters, 2012, vol. 19, issue 15, pages 1431-1436

Abstract: A popular approach to estimating income variance in cross-sectional data is to use an aggregate method by categorizing sample observations into arbitrarily formed groups, taking into account some socio-economic attributes. This study proposes an alternative technique that can be used to estimate income variance from cross-sectional data. Results indicate that this multiplicative heteroskedastic feasible least squares estimation procedure is consistent and efficient, consumes less time and requires less manipulation of data.

Date: 2012
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