Year: 2001
Type: article
Abstract: When data are censored, ordinary least squares regression can provide biased coefficient estimates. Maximum likelihood approaches to this problem are valid only if the error distribution is correctly specified, which can be problematic in practice. We review several semiparametric estimators for the censored regression model that do not require parameterization of the error distribution. These estimators are used to examine changes in black-white earnings inequality during the 1960s based on censored tax records. The results show that there was significant earnings convergence among black and white men in the American South after the passage of the 1964 Civil Rights Act.
DOI: 10.1257/jep.15.4.29
Authors: Kenneth Y Chay, James L Powell
Institution: University of California, Berkeley
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
SDG: Reduced inequalities
Open Access status: bronze
OpenAlex ID: W2115016757