Modelling zero-inflated count data when exposure varies: with an application to sick leave

This paper is concerned with the analysis of zero-inflated count data when time of exposure varies. It proposes a new zero-inflated count data model that is based on two homogeneous Poisson processes and accounts for exposure time in a theory consistent way. The new model is used in an application to the effect of insurance generosity on the number of absent days.Exposure, Poisson regression, complementary log-log link

Consistent Estimation of the Fixed Effects Ordered Logit Model

The paper re-examines existing estimators for the panel data fixed effects ordered logit model, proposes a new one, and studies the sampling properties of these estimators in a series of Monte Carlo simulations. There are two main findings. First, we show that some of the estimators used in the literature are inconsistent, and provide reasons for the inconsistency. Second, the new estimator is never outperformed by the others, seems to be substantially more immune to small sample bias than other consistent estimators, and is easy to implement. The empirical relevance is illustrated in an application to the effect of unemployment on life satisfaction.ordered response, panel data, correlated heterogeneity, incidental parameters

Reconsidering the analysis of longitudinal happiness data - with an application to the effect of unemployment

The paper reconsiders existing estimators for the panel data fixed effects ordered logit model, including one that has not been used in econometric studies before, and studies the small sample properties of these estimators in a series of Monte Carlo simulations. There are two main findings. First, we show that some of the estimators used in the literature are inconsistent. Second, the new estimator seems to be more immune to small sample bias than other consistent estimators and is easy to implement. The empirical relevance is illustrated in an application to the effect of unemployment on happiness. Choosing the right estimator avoids a bias of up to 30 percent in key parameters.Ordered response, panel data, correlated heterogeneity, incidental parameters

The relationship between well-being and commuting revisited: does the choice of methodology matter?

This paper provides an assessment of a range of alternative estimators for fixed-effects ordered models in the context of estimating the relationship between subjective well-being and commuting behaviour. In contrast to previous papers in the literature we find no evidence that longer commutes are associated with lower levels of subjective well-being, in general. From a methodological point of view our results support earlier findings that linear and ordered fixed-effects models of life satisfaction give similar results. However, we argue that ordered models are more appropriate as they are theoretically preferable, straightforward to implement and lead to easily interpretable results

Household Finances and Well-Being in Australia: An Empirical Analysis of Comparison Effects

This paper explores the importance of the household’s financial position for an individual’s level of well-being. Initially, the empirical analysis, based on the Household, Income and Labour Dynamics in Australia (HILDA) Survey, a large nationally representative panel survey, aims to ascertain the impact of the household’s monetary financial position on overall life satisfaction and financial well-being, with the latter being measured by financial satisfaction and subjective prosperity. The empirical analysis confirms that the household’s level of net wealth, assets and debt are important determinants of overall life satisfaction and financial well-being. The paper goes on to explore whether the financial situation of households in a comparison group influences an individual’s overall life satisfaction and financial well-being. The results suggest that the financial position of households in the comparison group is an important determinant of an individual’s level of overall life satisfaction and financial well-being, with information effects generally dominating comparison effects. In addition, the effects of the comparison group are asymmetric depending on whether a household’s financial position is above or below the average of the reference group