Study week on the econometric approach to development planning

Bibliographic data

Monograph

Identifikator:: 1824422792

URN:: urn:nbn:de:zbw-retromon-217476

Document type:: Monograph

Title:: Study week on the econometric approach to development planning

Place of publication:: Amsterdam [u.a.]

Publisher:: North-Holland Publ. Co. [u.a.]

Year of publication:: 1965

Scope:: XLVII, 1259 S.; graph. Darst.

Digitisation:: 2022

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Dynamic structure and estimation in economy-wide econometric models / FranklinM. Fisher, Massachuetts Institute of Technology - Cambridge, Mass. - U.S.A.

Collection:: Economics Books

440 PONTIFICIAE ACADEMIAE SCIENTIARVM SCRIPTA VARIA - 28 there may be some set of » endogenous variables to be replaced whose regressions together involve less than 7 predetermined variables. Alternatively, counting the instruments included in the equation to be estimated there may not be as many instruments used in the final stage as there are parameters to be estimated. This can happen, of course, although it is perhaps relatively unlikely. If it does occur, then it is a sign that the equation in question is unidentifiable from the sample available, that the causal information contained in the sample is insufficient to allow estimation of the equation without re- laxing the inconsistency requirements. To put it another way, it can be argued that to rectify this situation by the introduc- tion in the first-stage regressions of variables failing the causal test as described is an ad hoc device which adds no causal information. While such variables may in fact appear in such regressions with non-zero coefficients in the probability limit, their use in the sample adds nothing to the quality of the estimates save the ability to secure numbers and disguise the problem. Of course, such an argument is a bit too strong. Whether a variable adds significantly to correlation is a function of what one means by significance. The problem is thus a con- tinuous rather than a discrete one and should be treated as such. For the criterion of significance used, in some sense, the equa- tion in question cannot be estimated from the sample in the circumstance described; it may be estimatable with a less strin- gent significance criterion. In practice, if the significance requirements are relaxed, the moment matrix to be inverted Will pass from singularity to near-singularity and estimated asymptotic standard errors will be large rather than infinite. The general point is that if multicollinearity cannot be suffi- ciently eliminated using causal information, little is to be gained by eliminating it by introducing more or less irrelevant variables. A somewhat related point is that the use of different vari- 6] Fisher - pag. 56

Access restriction

Copyright

fullscreen: Study week on the econometric approach to development planning

Monograph

Chapter

Table of contents

Download

Monograph

Chapter

This page

Image fragment

Citation links

Citation recommendation