With or without U? The appropriate test for a U shaped relationship

Non-linear relationships are common in economic theory, and such relationships are also frequently tested empirically. We argue that the usual test of non-linear relationships is flawed, and derive the appropriate test for a U shaped relationship. Our test gives the exact necessary and sufficient conditions for the test of a U shape in both finite samples and for a large class of models.

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Year of publication:	2007
Authors:	Lind, Jo Thori ; Mehlum, Halvor
Publisher:	Oslo : University of Oslo, Department of Economics
Subject:	Kuznets Kurve \| Regression \| Modell-Spezifikation \| Ökonometrie \| U shape \| hypothesis test \| Kuznets curve \| Fieller interval

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Series:	Memorandum ; 2007,21
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
Other identifiers:	547244843 [GVK] hdl:10419/63088 [Handle]
Classification:	C12 - Hypothesis Testing ; C20 - Econometric Methods: Single Equation Models. General
Source:	EconStor

Persistent link: https://www.econbiz.de/10010284374