Specification and Estimation of Rating Scale Models - With an Application to the Determinants of Life Satisfaction

24 Pages Posted: 22 Apr 2011

See all articles by Raphael Studer

Raphael Studer

Independent

Rainer Winkelmann

University of Zurich - Statistics and Empirical Economic Research; IZA Institute of Labor Economics; Centre for Economic Policy Research (CEPR)

Date Written: January 2011

Abstract

This article proposes a new class of rating scale models, which merges advantages and overcomes shortcomings of the traditional linear and ordered latent regression models. Both parametric and semi-parametric estimation is considered. The insights of an empirical application to satisfaction data are threefold. First, the methods are easily implementable in standard statistical software. Second, the non-linear model allows for exible marginal effects, and predicted means respect the boundaries of the dependent variable. Third, average marginal e ects are similar to ordinary least squares estimates.

Keywords: Rating variables, non-linear least squares, quasi-maximum likelihood, semiparametric least squares, subjective well-being

JEL Classification: C21, I00

Suggested Citation

Studer, Raphael and Winkelmann, Rainer, Specification and Estimation of Rating Scale Models - With an Application to the Determinants of Life Satisfaction (January 2011). Available at SSRN: https://ssrn.com/abstract=1815067 or http://dx.doi.org/10.2139/ssrn.1815067

Rainer Winkelmann

University of Zurich - Statistics and Empirical Economic Research ( email )

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IZA Institute of Labor Economics ( email )

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Centre for Economic Policy Research (CEPR)

London
United Kingdom

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