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Overidentification Tests with Grouped Data


Caroline M. Hoxby


Stanford University; National Bureau of Economic Research (NBER); Hoover Institution; Stanford University

M. Daniele Paserman


Hebrew University of Jerusalem - Department of Economics; Centre for Economic Policy Research (CEPR); Institute for the Study of Labor (IZA)
February 1998

NBER Working Paper No. t0223

Abstract:     
This paper examines the validity of overidentification tests and exogeneity tests in the presence of grouped data. We find that even a small intra-group correlation, when instruments do not vary within groups, may generate a substantial bias in the standard overidentification tests described in textbooks.

Number of Pages in PDF File: 27

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Date posted: July 19, 2000  

Suggested Citation

Hoxby, Caroline M. and Paserman, M. Daniele, Overidentification Tests with Grouped Data (February 1998). NBER Working Paper No. t0223. Available at SSRN: http://ssrn.com/abstract=226633

Contact Information

Caroline M. Hoxby (Contact Author)
Stanford University ( email )
Landau Economics Building
579 Serra Mall
Stanford, CA 94305-6072
United States
National Bureau of Economic Research (NBER)
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Hoover Institution ( email )
Stanford, CA 94305-6010
United States
Stanford University ( email )
Department of Economics
Stanford University
Stanford, CA 94305
United States
650-725-8719 (Phone)
650-725-5702 (Fax)
M. Daniele Paserman
Hebrew University of Jerusalem - Department of Economics ( email )
Mount Scopus
Jerusalem, 91905
Israel
+972 2 588 3365 (Phone)
+972 2 581 6071 (Fax)
Centre for Economic Policy Research (CEPR)
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
Institute for the Study of Labor (IZA)
P.O. Box 7240
Bonn, D-53072
Germany
Feedback to SSRN (Beta)


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