The work of the Stock Exchange

Study week on the econometric approach to development planning

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Monograph

Identifikator:: 1831284952

URN:: urn:nbn:de:zbw-retromon-225876

Document type:: Monograph

Author:: Meeker, James Edward http://d-nb.info/gnd/126597340

Title:: The work of the Stock Exchange

Edition:: Revised edition

Place of publication:: New York

Publisher:: The Ronald Press Company

Year of publication:: [1930]

Scope:: XVI, 720 Seiten; Illustrationen, Diagramme

Digitisation:: 2022

Collection:: Economics Books

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

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Document type:: Monograph

Structure type:: Chapter

Title:: Chapter III. The rise of the New York stock exchange

Collection:: Economics Books

SEMAINE D'ÉTUDE SUR LE ROLE DE L’ANALYSE ECONOMETRIQUE ETC. GJ given equation, we have gone as far as we can. The avoidance of multicollinearity is a necessary part of such a procedure because multicollinearity is one sort of failure of the causal criterion discussed above. To attempt to eliminate that multi- collinearity which inevitably results from just those causal rela- tions which are to be estimated, however, is self-defeating (%) 6.3. Rules for the Use of Eligible Instrumental Variables We have several times pointed out that the causal criterion and that of no correlation with the given disturbance may be inconsistent and that one may only be able to satisfy one more closely by sacrificing the other to a greater extent. In principle, a fully satisfactory treatment of the use of instrumental variables in economy-wide models would involve a full-scale Bayesian analysis of the losses and gains from any particular action. Such an analysis is clearly beyond the scope of the present paper, although any recommended procedure clearly has some judgment of probable losses behind it, however vague such judgment may be. We shall proceed by assuming that the no-correlation cri- terion has been used to secure a set of eligible instrumental variables whose use is judged to involve only tolerable incon- sistencies in the estimation of a given equation. Note that the set may be different for different equations. Within that set are current and lagged exogenous variables and lagged endo- (*!) I want to make it clear that I am not accusing KLoEk and MENNES of attempting to do this. Their proposals are designed to eliminate multi- collinearity in the first stage of the procedure where it is desirable to do so. Their « Method 2 » [17, pp. 51-52] does eliminate collinearity in the se- cond stage between the replaced endogenous variables and the included predetermined ones, but this is not necessarily the same as the desirable and irreducible collinearity among the variables in the equation discussed in the text. It may well occur in practice that the KLoEK-MENNES proposals lead to desirable results, although an approach using more structural in- formation than does theirs seems preferable. ‘6] Fisher - pag. 49

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