Volume no :4, Issue no: 1, January 2010

Journal of Mathematical Sciences: Advances and Applications

ESTIMATION OF THE MISREPORTING MODELS USING MICRO-DATA SETS DERIVED FROM THE CONSUMER EXPENDITURE SURVEY: THE GAP BETWEEN MACRO AND MICRO ECONOMIC STATISTICS ON CONSUMER DURABLES

Author's: Atsushi Maki and Thesia I. Garner
Pages: [123] - [152]
Received Date: September 4, 2009
Submitted by:

Abstract

In many countries, a gap between macroeconomic and microeconomic statistics is observed. To explain the gap, the present paper tests the misreporting hypothesis originally proposed by Deaton and Irish [4]. The data used for estimation involves ten clusters of consumer durables from the Consumer Expenditure Survey in the US. Misreporting takes place, if a household purchased goods but did not report the amount (type 1 misreporting), or it purchased goods but reported the amount incorrectly (type 2 misreporting). The variance of the measurement error in type 2 misreporting is small and is not statistically significant. The main source of underreporting is due to zero expenditure households that purchased goods but did not report the amount (type 1 misreporting).

Keywords

econometric modelling, double hurdle model, misreporting hypothesis.