Paul L. Caron
Dean


Monday, August 5, 2013

Simkovic Responds to Merritt: Sample Size, Standard Errors, and Confidence Intervals

Following up on yesterday's post, Deborah Jones Merritt (Ohio State), Small Sample Sizes Undermine Claims of 'The Economic Value of a Law Degree':  Michael Simkovic (Seton Hall), Sample Size, Standard Errors, and Confidence Intervals:

At law school café (reposted on Tax Prof) Deborah Merritt asks several questions about The Economic Value of a Law Degree related to sample size and uncertainty. We thank Professor Merritt for her comments and hope they helped clarify the annual results for those who were having trouble interpreting Figures 5 and 6. In the paper we note that Figure 6, which looks at young law graduates over time, is too noisy for any strong conclusions, though one can readily reject that Figure 5's ups and downs are just noise. This post includes brief discussions of some of the interesting points raised.

  • The estimates in the paper don't depend on cyclical law school premia
  • Is our overall sample size big enough?
  • How strong is the specific evidence from SIPP for cyclicality of earnings premiums?
  • How should we understand confidence intervals and point estimates?
  • How strong is the evidence for a bi-modal distribution of earnings?
  • Would bimodality cast doubt on the results of our analysis?

Prior TaxProf Blog coverage:

https://taxprof.typepad.com/taxprof_blog/2013/08/simkovic-responds-to-.html

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