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Re: st: Transformation of variable with pos/neg values via asinh
From
David Hoaglin <[email protected]>
To
[email protected]
Subject
Re: st: Transformation of variable with pos/neg values via asinh
Date
Mon, 18 Nov 2013 20:43:21 -0500
Dear Steven,
The presence of extreme values (relative to the variation in the bulk
of the data) suggests that the variable does not have a normal
distribution. Do you have a mixture of some sort?
What is the source of the negative values of CEO wealth?
A variable that has both positive and negative values is often the
result of taking the difference between two positive quantities. If
some sort of transformation seems likely to be useful, it is usually a
good idea to transform the variables that are the basis for the
difference.
Regards,
David Hoaglin
On Mon, Nov 18, 2013 at 6:21 PM, Steven Delbright
<[email protected]> wrote:
> Dear Austin:
>
> Thanks so much for the quick response! I indeed struggle with a
> "wealth" dependent variable (CEO wealth to be exact). Do you have some
> sample citations for academic work transforming wealth variables (not
> necessarily in management but also other fields).
>
> Also, I found your comment regarding using a different link. I never
> considered this option before but always transformed my DV. What link
> would I use for untransformed wealth variables with fat tails?
>
> Thanks much!
> Steven
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