Kemp, Gordon C R (1996) Scale Equivalence and the Box-Cox Transformation. Working Paper. University of Essex, Department of Economics, Economics Discussion Papers 459.
Kemp, Gordon C R (1996) Scale Equivalence and the Box-Cox Transformation. Working Paper. University of Essex, Department of Economics, Economics Discussion Papers 459.
Kemp, Gordon C R (1996) Scale Equivalence and the Box-Cox Transformation. Working Paper. University of Essex, Department of Economics, Economics Discussion Papers 459.
Abstract
The Box-Cox family of transformations has two useful features: first, it includes linear and logarithmic transformations as special cases; and, second, it possesses strong scale equivariance properties, including the property that the transformation parameter is unaffected by the rescaling. Its main disadvantage is that both the domain and the range of the transformation are, in general, bounded. We show that, for a certain class of models, if a model demonstrates these scale equivariance properties for the dependent variable then the transformation on the dependent variable must be a variant of the Box-Cox transformation.
Item Type: | Monograph (Working Paper) |
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Subjects: | H Social Sciences > HB Economic Theory |
Divisions: | Faculty of Social Sciences > Economics, Department of |
Depositing User: | Jim Jamieson |
Date Deposited: | 17 Jul 2012 12:05 |
Last Modified: | 28 Jan 2016 12:30 |
URI: | http://repository.essex.ac.uk/id/eprint/2883 |