Modelling Scale Effect in Cross-section Data: The Case of Hedonic Price Regression

Qin, Duo; Liu, Yimeng

Abstract

An innovative and simple experiment with cross-section data ordering is carried out to exploit a basic feature between many economic variables – nonlinear scale dependence. The experiment is tried on hedonic price models using two data sets for automobiles and computers respectively. The key findings are: (1) Hedonic price indices can be significantly biased if they are constructed using models which disregard possible nonlinear scale effects latent in data samples; (2) Scale-based data ordering offers considerable potential to filter such scale-dependent information from cross-section samples; (3) The filtering can be easily carried out by systematic adoption of dynamic modelling methods.

Citation

Qin, D., & Liu, Y. (2015). Modelling Scale Effect in Cross-section Data: The Case of Hedonic Price Regression. Tongji yanjiu (Beijing.1980), 32(2), 97-103. https://doi.org/10.19343/j.cnki.11-1302/c.2015.02.014

• Journal Article Type: Article
• Publication Date: Jan 1, 2015
• Deposit Date: Apr 20, 2015
• Publicly Available Date: Jan 2, 2115
• Journal: Tongji yanjiu = Statistical Research
• Print ISSN: 1002-4565
• Peer Reviewed: Peer Reviewed
• Volume: 32
• Issue: 2
• Pages: 97-103
• DOI: https://doi.org/10.19343/j.cnki.11-1302/c.2015.02.014
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• Additional Information: Additional Information : In Chinese with English abstract