Units of measurement and the inverse hyperbolic sine transformation
Publikation: Bidrag til tidsskrift › Tidsskriftartikel › Forskning › fagfællebedømt
Dokumenter
- Fulltext
Accepteret manuskript, 401 KB, 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 show that regression results can heavily 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 an empirical illustration shows the relevance and applicability of our suggested procedure.
Originalsprog | Engelsk |
---|---|
Tidsskrift | The Econometrics Journal |
Vol/bind | 24 |
Udgave nummer | 2 |
Sider (fra-til) | 334–351 |
Antal sider | 18 |
ISSN | 1368-4221 |
DOI | |
Status | Udgivet - 2021 |
ID: 253652681