Model Specifications and Endogeneity

Posted: 5 Jun 2013

See all articles by Alice Orcutt Nakamura

Alice Orcutt Nakamura

University of Alberta - School of Business

Masao Nakamura

University of British Columbia (UBC) - Sauder School of Business

Date Written: March 6, 1997

Abstract

This paper considers the treatment of endogenous explanatory variables in the work of the Cowles Commission and in Carl Christ's classic 1966 textbook, and certain problems that arise when this approach is followed in areas such as the study of female labor supply where a prior knowledge is sparse or uncertain. The motivations for, and evidence against the use of, mixed estimation approaches involving exogeneity pretests are explored. The paper concludes with a consideration of complementary and alternative empirical approaches, including greater use of predictive evaluation as suggested by Christ.

Keywords: Endogeneity, endogcneity testing, lnstrunaental variables, Female labor supply

JEL Classification: C14, C30

Suggested Citation

Nakamura, Alice Orcutt and Nakamura, Masao, Model Specifications and Endogeneity (March 6, 1997). University of Alberta School of Business Research Paper No. 2013-286, Journal of Econometrics, Vol. 14, 1998, Available at SSRN: https://ssrn.com/abstract=2273834

Alice Orcutt Nakamura (Contact Author)

University of Alberta - School of Business ( email )

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Masao Nakamura

University of British Columbia (UBC) - Sauder School of Business ( email )

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Vancouver, BC V6T 1Z2
Canada
604-822-8434 (Phone)
604-822-8477 (Fax)

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