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Re: st: ZOIB procedure

From   Prerna S <[email protected]>
To   [email protected]
Subject   Re: st: ZOIB procedure
Date   Tue, 20 Sep 2011 05:09:53 -0400


Below you mention that the Aitchison method provides estimates that
are not easily interpretable. I am assuming then that zoib does not
impose this restriction?  I had previously assumed that the
presentation of zoib results would require presenting marginal effects
exclusively.  But if that is not the case, how would one interpret the
estimated coefficients under zoib?



On 19 September 2011 04:11, Maarten Buis <[email protected]> wrote:

> I am guessing, but it seems to me you are worried about correlation of
> error terms across income sources. This is a hard problem, in part
> because proportions are inherently (negatively) correlated. If one
> proportion increases, than the rest will have to decrease. Some work
> has been done by Aitchison (2003), but he sacrifices an interpretable
> effect of explanatory variables on the proportion in order to get the
> correlations right. This is fine if you are mainly interested in those
> correlations, but a problem otherwise.
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