A comparative study of alternative estimators for the unbalanced two‐way error component regression model

Baltagi, Badi H.; Song, Seuck Heun; Jung, Byoung Cheol

doi:10.1111/1368-423x.t01-1-00094

Cited by 86 publications

(72 citation statements)

References 15 publications

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“…The composition of the sample allows the combination of time series and cross sections with adequate opportunity to take advantage of the creation of a panel data, especially in the control of unobserved heterogeneity, i.e., the individual characteristics of each entity that are not observable but affect the variables under study (Arellano and Bover 1991;Arellano 1993;Himmelberg et al 1999;Palia 2001;Brick et al 2005). Additionally, since at present the idea of using unbalanced panels with total observations is widely accepted, the option of analyzing balanced panels with fewer companies is discarded because it may be conditioned by the survival bias (Baltagi and Chang 1994).…”

Section: Design and Research Methodologymentioning

confidence: 99%

Does Corporate Governance Influence Earnings Management in Latin American Markets?

2013

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Although US and European research has documented improvement in earnings quality associated with corporate governance characteristics, the situation in Latin America is questionable, given the business environment in which firms operate, which is characterized by controlling family ownership and weak legal protection. The purpose of this study is to examine the relation between the internal mechanisms of Corporate Governance and Earnings Management measured by discretionary accrual. We use a sample of listed Latin American non-financial companies from the period 2006-2009. Our results show how in the Latin American context the role of external directors is limited and that Boards which meet more frequently take a more active position in the monitoring of insiders, so showing a lower use of manipulative practices. In addition, we find a non-linear relation between insider ownership and discretionary accruals, also pointing to the fact that ownership concentration may be a manipulative practices constrictor mechanism only when the ownership of main shareholders is moderate. The findings have important policy implications since this is, to the best of our knowledge, the first study to analyze the relation between the effectiveness of the government and the earnings management behavior. As policy implications, we document how when a country implements controls aimed at reducing corruption, strengthening the rule of law or improving the effectiveness of government, this leads to a reduction in firm earnings management.

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Section: Design and Research Methodologymentioning

confidence: 99%

Does Corporate Governance Influence Earnings Management in Latin American Markets?

2013

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“…We estimated standard errors for the one-way unbalanced data model using a specialization (Baltagi and Chang 1994) of the approach proposed by Wansbeek and Kapteyn (1989) for unbalanced two-way models. The Wansbeek and Kapteyn method for estimating variance components is the default approach used by SAS in the one-way random effects estimation of unbalanced panel data (SAS 2011b).…”

Section: Yr T Is a Time Trend In Years;mentioning

confidence: 99%

An Examination of Temporal Trends in Electricity Reliability Based on Reports from U.S. Electric Utilities

Eto¹

2012

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Since the 1960s, the U.S. electric power system has experienced a major blackout about once every 10 years. Each has been a vivid reminder of the importance society places on the continuous availability of electricity and has led to calls for changes to enhance reliability. At the root of these calls are judgments about what reliability is worth and how much should be paid to ensure it.In principle, comprehensive information on the actual reliability of the electric power system and on how proposed changes would affect reliability ought to help inform these judgments. Yet, comprehensive, national-scale information on the reliability of the U.S. electric power system is lacking.This report helps to address this information gap by assessing trends in U.S. electricity reliability based on information reported by electric utilities on power interruptions experienced by their customers. Our research augments prior investigations, which focused only on power interruptions originating in the bulk power system, by considering interruptions originating both from the bulk power system and from within local distribution systems. Our research also accounts for differences among utility reliability reporting practices by employing statistical techniques that remove the influence of these differences on the trends that we identify.The research analyzes up to 10 years of electricity reliability information collected from 155 U.S. electric utilities, which together account for roughly 50% of total U.S. electricity sales. The questions analyzed include:1. Are there trends in reported electricity reliability over time? 2. How are trends in reported electricity reliability affected by the installation or upgrade of an automated outage management system? 3. How are trends in reported electricity reliability affected by the use of IEEE Standard

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“…Note that one can also include covariates in the model. In this case, a mixed-effects regression model could be used to estimate the regression coefficients and the variance components simultaneously (see for example Baltagi & Chang, 1994, for a discussion of the ANOVA estimates in such a model).…”

Section: Discussionmentioning

confidence: 99%

Principal Components of Heritability for High Dimension Quantitative Traits and General Pedigrees

Oualkacha¹,

Labbe²,

Ciampi³

et al. 2012

Statistical Applications in Genetics and Molecular Biology

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For many complex disorders, genetically relevant disease definition is still unclear. For this reason, researchers tend to collect large numbers of items related directly or indirectly to the disease diagnostic. Since the measured traits may not be all influenced by genetic factors, researchers are faced with the problem of choosing which traits or combinations of traits to consider in linkage analysis. To combine items, one can subject the data to a principal component analysis. However, when family date are collected, principal component analysis does not take family structure into account. In order to deal with these issues, Ott & Rabinowitz (1999) introduced the principal components of heritability (PCH), which capture the familial information across traits by calculating linear combinations of traits that maximize heritability. The calculation of the PCHs is based on the estimation of the genetic and the environmental components of variance. In the genetic context, the standard estimators of the variance components are Lange's maximum likelihood estimators, which require complex numerical calculations. The objectives of this paper are the following: i) to review some standard strategies available in the literature to estimate variance components for unbalanced data in mixed models; ii) to propose an ANOVA method for a genetic random effect model to estimate the variance components, which can be applied to general pedigrees and high dimensional family data within the PCH framework; iii) to elucidate the connection between PCH analysis and Linear Discriminant Analysis. We use computer simulations to show that the proposed method has similar asymptotic properties as Lange's method when the number of traits is small, and we study the efficiency of our method when the number of traits is large. A data analysis involving schizophrenia and bipolar quantitative traits is finally presented to illustrate the PCH methodology.

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A comparative study of alternative estimators for the unbalanced two‐way error component regression model

Cited by 86 publications

References 15 publications

Does Corporate Governance Influence Earnings Management in Latin American Markets?

Does Corporate Governance Influence Earnings Management in Latin American Markets?

An Examination of Temporal Trends in Electricity Reliability Based on Reports from U.S. Electric Utilities

Principal Components of Heritability for High Dimension Quantitative Traits and General Pedigrees

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