Consistently bounding parameter values with one instrument and two endogenous explanatory variables

The current paper considers a linear regression framework with two endogenous regressors, but only one instrument that is correlated with both. I demonstrate that under reasonable conditions, some of which are testable from the data, these different sources of endogeneity act in opposing directions and hence IV regression can generate economically meaningful bounds.

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Year of publication:	2012
Authors:	Dunn, Richard A
Published in:	Economics Bulletin. - AccessEcon, ISSN 1545-2921. - Vol. 32.2012, 2, p. 1074-1081
Publisher:	AccessEcon
Subject:	endogeneity \| instrumental variables \| bounding \| under-identification

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Extent:	application/pdf
Type of publication:	Article
Classification:	C1 - Econometric and Statistical Methods: General ; C2 - Econometric Methods: Single Equation Models
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10011278545