Modelling Category Inflation with Multiple Inflation Processes: Estimation,Specification and Testing1 |
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| Authors: | Sarah Brown Mark N. Harris Christopher Spencer |
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| Affiliation: | 1. Department of Economics, University of Sheffield, 9 Mappin Street, Sheffield, S1 4DT UK;2. School of Economics, Finance and Property, Faculty of Business and Law, Curtin University, Perth, WA, 6845 Australia;3. School of Business and Economics, Loughborough University, Ashby Road, Loughborough, Leicestershire, LE11 3TU UK |
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| Abstract: | Zero-inflated ordered probit (ZIOP) and middle-inflated ordered probit (MIOP) models are finding increasing favour in the discrete choice literature. We propose generalizations to these models – which collapse to their ZIOP/MIOP counterparts under a set of simple parameter restrictions – with respect to the inflation process. These generalizations form the basis of a new specification test of the inflation process in ZIOP and MIOP models. Support for our generalization framework is principally demonstrated by revisiting a key ZIOP application from the economics literature, and reinforced by the reassessment of an important MIOP application from political science. Our specification test supports the generalized models over the original ZIOP/MIOP ones, suggesting an important role for it in modelling zero- and middle-inflation processes. |
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