Top Coded

Please note that the content of this book primarily consists of articles available from Wikipedia or other free sources online. In econometrics and statistics, a top-coded dataset is one for which the upper bound is not known. This is often done to preserve the anonymity of people participating in the survey (for example, if a survey included a person with wealth of $51 billion, it would not be anonymous because people would know it is Bill Gates). If the lower bound of the top-coded group is used as a regressor value (30000 in the example above), OLS is biased and inconsistent. The top-coded group can be omitted from the regression entirely. Provided there are no systematic differences between the omitted group and the included groups, OLS is consistent and unbiased.

Pagina's: 104, Paperback, Betascript Publishers