Table 1

Cross-section individual level data Impacts of Clustering and Estimator Choices on Estimated Coefficients and Standard Errors

Estimation Method
Slope coefficient0.01080.0314
Standard errors
    Heteroscedastic robust0.0042
    Cluster robust (cluster on state)0.02290.0214
    Pairs cluster bootstrap0.02240.0216
Number observations65,68565,685
Number clusters (states)5151
Cluster size range519 to 5,866519 to 5,866
Intraclass correlation0.018
  • Notes: March 2012 CPS data, from IPUMS download. Default standard errors for OLS assume errors are iid; default standard errors for FGLS assume the random effects model is correctly specified. The bootstrap uses 399 replications. A fixed effect model is not possible because the regressor is invariant within states.