Estimating Engel curvesA new way to improve the SILC-HBS matching process

  1. Julio López - Laborda 1
  2. Carmen Marín González
  3. Jorge Onrubia 2
  1. 1 Universidad de Zaragoza, España
  2. 2 Universidad Complutense de Madrid, España
Revista:
Documentos de trabajo ( FEDEA )

ISSN: 1696-7496

Año de publicación: 2017

Número: 15

Páginas: 1-19

Tipo: Documento de Trabajo

Otras publicaciones en: Documentos de trabajo ( FEDEA )

Resumen

There are several ways to match SILC-HBS surveys, with the most common technique involving the estimation of Engel curves using Ordinary Least Squares in logs with HBS data to impute household expenditure in the income dataset (SILC). The estimation in logs has certain advantages, as it can deal with skewness in data and reduce heteroskedasticity. However, the model needs to be corrected with a smearing estimate to retransform the results into levels. The presence of intrinsic heteroskedasticity in household expenditure therefore calls for another technique, as the smearing estimate produces a bias. Generalized Linear Models (GLMs) are presented as the best option.