Theils t index, and the ge 0 is called the theils l index mean logarithmic. Otherwise, if you wanted one of his other parameters, then ignore this. I tried to decompose the income by race and strata, but it wont work. Stata module to calculate inequality indices with decomposition by subgroup, statistical software components s366007, boston college department of economics, revised 22 jan 2015. The gini coefficient requires you to construct a lorenz curve that would look like this. Advantages claimed for theils coefficient over alternative measures of. It would be possible to add an insample version of theils u as shown in the example, but ive never needed it and i cant imagine why anyone else would. Local models are often fitted by some kind of updating procedure, such as the kalman filter, which is easy to apply using a computer. Application of theil group logit methods to districtlevel. Stata module to produce refined theil index decomposition by group and quantile. Swire4r acts like a client application for swire, providing the user with various basic functions for retrieving data from stata and exporting data to stata.
This page shows an example of a correlation with footnotes explaining the output. U 1 read thisit will help3 a complete stata documentation set contains more than 14,000 pages of information in the following manuals. Ge0 is the mean logarithmic deviation, ge1 is the theil index, and ge2 is half the. To do this analysis, we first make a dummy variable called female that is coded 1 for female, and 0 for male and femht that is the product. Theil inequality coefficient in addition, eviews can compute the combination test, or forecast encompassing test chong and hendry, 1986. Decomposing the theil coefficient of inequality statalist.
For example, you might believe that the regression coefficient of height predicting weight would be higher for men than for women. The theil index is a statistic primarily used to measure economic inequality and other economic phenomena, though it has also been used to measure racial segregation the theil index t t is the same as redundancy in information theory which is the maximum possible entropy of the data minus the observed entropy. The variable female is a 01 variable coded 1 if the student was female and 0 otherwise. If you really wanted the theil sen median slope, then download the somersd package from ssc, which calculates confidence intervals for it. The linear correlation coefficient pearsons r equation 3. Gini coefficients were calculated using the inequal7 module for stata by. Can i compare the coefficients of one certain variable from two different samples by suest. You will see that the theil index corresponds to ge1 in ineqdecos parlance. This can ensure most accurate lorenz curve and thus most accurate computation of the coefficient.
I am trying to decompose the theil coefficient of income inequality into between and within components on a sector manufacturing, retail, etc. Christopher f baum bc diw theil goldberger mixed estimation stata conference chi11 11 39. Bf bm, where bf is the regression coefficient for females, and bm is the regression coefficient for males. Stata module to compute measures of inequality, statistical software components s456748, boston college department of economics, revised apr 2007. Covariance and correlation analysis including pearson, spearman rankorder, kendalls taua and taub and partial analysis. We wish to warn you that since stata 11 files are downloaded from an external source, fdm. Stata program atkinson, inequal, lorenz, relsgini these four adofiles provide a variety of measures of inequality. The variables read, writ e, math and science are scores that 200 students received on these tests. Oct 25, 2006 which theil index are you asking about. However, it does not have a straightforward representation and lacks the appealing interpretation of the gini coefficient. Theil, inequality and the structure of income distribution.
Stata 10 tutorial 5 page 3 of 32 pages loading a stataformat dataset into stata use load, or read, into memory the dataset you are using. The variables read, write, math and science are scores that 200 students received on these tests. To best learn, try to work through all 10 questions by providing stata commands and answers. How can i compare regression coefficients between 2 groups. The stata newsa periodic publication containing articles on using stata and tips on using the software, announcements of new releases and updates, feature highlights, and other announcements of interest to interest to stata usersis sent to all stata users and those who request information about stata from us. To check for updates, type adoupdate coefplot alternatively, you can download coefplot from the ssc archive and add the files to your system manually see file readme. Allisons principal concern is to compare different methods for assessing relative levels of social inequality particularly income 7. Whenever the commonly used leastsquares regression method is used for fitting an equation into a set of x,ydata points, all errors in the ydirection are normally distributed i. Gini coefficient would would work best if data about each and every citizen in the country is available. Regional income inequality model based on theil index decomposition and weighted variance coeficient article pdf available in journal of physics conference series 9831. Instructions on how to install the dasp package are provided in the.
The model building principle of parsimony states that the simpler the model, the more. Sep 02, 2012 stata program atkinson, inequal, lorenz, relsgini these four adofiles provide a variety of measures of inequality. Philippe van kerm statistical software components from boston college department of economics. Thereafter, type help coefplot to view the help file. Stata faq sometimes your research may predict that the size of a regression coefficient should be bigger for one group than for another. Advantages claimed for theil s coefficient over alternative measures of. Compared to the gini index, it has the advantage of being additive across different subgroups or regions in the country. Stata module to produce refined theil index decomposition by group and quantile, statistical software components s458187, boston college department of economics. The module is made available under terms of the gpl v3. A 1 unit increase in gpa produces, on average, a 1.
Swire is a plugin for stata which acts like a server. For general information on stata, see presentations on coefplot. Rapid economic development may not in accordance with peoples per capita income. To get the ystandardized coefficient, just divide b k by the standard deviation of y, e. Stata 10 tutorial 5 page 3 of 32 pages loading a stata format dataset into stata use. In stata, i am using the coefplot package to try and plot one coefficient from multiple regressions in other words, there will be multiple coefficients, but each one comes from a different regression on the same plot. In the salaimartins sim from here on paper the theil index is derived as a particular case of a more general entropy index. Constructing long and dense timeseries of inequality using the theil index yeartoyear economywide measures of income distribution, such as the gini coefficient, are rarely available for long periods except in a few developed countries, and as a result few analyses of yeartoyear changes in inequality exist. What is the difference between the gini coefficient and. The naive model predicting no change will give a u value of 1, so better models will give u values between 0 and 1. We wish to warn you that since stata 11 files are downloaded from an external source, fdm lib bears no responsibility for the safety of such downloads. Statistical software components from boston college department of economics. The use and misuse of the coefficient of variation.
To download the product you want for free, you should use the link provided below and proceed to the developers website, as this is the only legal source to get stata 11. The actual developer of the program is statacorp lp. Ge0 is the mean logarithmic deviation, ge1 is the theil index, and ge2 is half the square of the coefficient of variation. Z x f log x f dfx 3 and also the following which has since become more widely known as the mean logarithmic deviation. Application of theil group logit methods to districtlevel vote shares. These two indexes were initially presented by theil 1967 and have been widely applied in the social and economic sciences. That is, my variable containing observations on income in agriculature is labelled a. A new command for plotting regression coefficients and other estimates, 2014 uk stata users group meeting, london, september 1112, 2014. A stata journal paper on coefplot is available from here.
In particular, i want to see how the coefficient of interest changes over time. The kendall theil robust line software ktrlineversion 1. Theils u statistic is a relative accuracy measure that compares the forecasted results with the results of forecasting with minimal historical data. In this article, i describe the algorithm proposed by berry, levinsohn, and pakes 1995, econometrica 63. Only few institutions provide inequality estimates and those who do so e. Pdf regional income inequality model based on theil index. A then you have to determine what fraction of the triangle is made up of area a. It is a special case of the generalized entropy index. If you get stuck, however, all 10 questions with stata commands are repeated below. Regional income inequality is an important issue in the study on economic development of a certain region. Decompose theil index for data including zero values no income.
Load, or read, into memory the dataset you are using. The lowest 10% of earners make 2% of all wages the next 40% of earners make 18% of all wages the next 40% of earners make 30% of all wages the highest 10% of earners make 50% of all wages. Timmermann, 2006 for evaluating whether averages of forecasts perform better than the individual forecasts. One could benchmark changes in a theil index in an analogous way. I do not know stata programming, so i cannot just refine jenkins ineqdec0 ado file by myself. Either theil s first, or t, index or theil s second, or l, index decomposition can be requested. All the ingredients to carry out both the static decomposition of the index shorrocks 1980, econometrica and the dynamic decomposition mookherjee and shorrocks 1982, economic. And following that, a stata program is included that would execute the commands for all 10 questions. Theil 1966, applied economic forecasting, north holland. In statistics, the uncertainty coefficient, also called proficiency, entropy coefficient or theils u, is a measure of nominal association. This command loads into memory the stataformat dataset auto1. Notes on how to compute gini coefficient suppose you are given data like this. If you dont include the std parameter, after a logistic regression listcoef does a variation of xstandardization, showing you the odds ratios i. We can compare the regression coefficients of males with females to test the null hypothesis ho.
Z log x f dfx 4 the second theil index or mld is an example of theils application of the concept of conditional entropy. Apr 06, 2016 the theil index is part of a larger family of measures referred to as the general entropy class. Our antivirus check shows that this download is clean. But i can add it to the next version if it is useful to someone. Stata is a suite of applications used for data analysis, data management, and graphics. We use this 01 variable to show that it is valid to use such a variable in a.
My question is, how i can calculate gini coefficient in stata for every. Update on other measures of income inequality atkinson index, gini coefficient, relative mean deviation, theil index, 1917 2015. The coefficient of variation is defined as the standard deviation of a variable divided by its mean. This module should be installed from within stata by typing ssc install theildeco. Update on other measures of income inequality atkinson index, gini coefficient, relative mean deviation, theil index, 19172015. A positive value of r indicates an increasing linear trend and a negative. Sector variable names follow eu nace sector coding a, b u. Hi borge, try findit ineqdeco after installing the ado file, read the help file. Stata users group meetings on the stata generalized entropy index command. An introduction into forecasting using stata duration. For the gini coefficient the most commonlyused summary inequality measure in official statistics my mentor used to refer to a two percentage point change as a benchmark reference point for a large change on the grounds that such a large change was rare in rich countries.
It also squares the deviations to give more weight to large errors and to exaggerate errors, which can help eliminate methods with large errors. The theil index has many different possible formulations. Gsm getting started with stata for macgsu getting started with stata for unixgsw getting started with stata for windowsu stata users guider stata base reference manualbayes stata bayesian analysis reference manual. Handbook on inequality measurement for country studies aceir. In statistics, the uncertainty coefficient, also called proficiency, entropy coefficient or theil s u, is a measure of nominal association.
Regional income inequality model based on theil index. The kendalltheil robust line software ktrlineversion 1. I am not principally an econometrician, but i know theil invented more than one parameter. In stata, i am using the coefplot package to try and plot one coefficient from multiple regressions in other words, there will be multiple coefficients, but each one comes from a different regression on the same plot here is code related to plotting same coefficient over time that accomplishes this when the coefficients have the same name in each regression. If you really wanted the theilsen median slope, then download the somersd package from ssc, which calculates confidence intervals for it. The theil index is part of a larger family of measures referred to as the general entropy class. It was first introduced by henri theil citation needed and is based on the concept of information entropy. I am using the coefplot package in stata to plot how a coefficient changes depending on the model employed.