No Need to Run Millions of Regressions

17 Pages Posted: 5 Nov 2000

See all articles by Jakob de Haan

Jakob de Haan

University of Groningen - Faculty of Economics and Business; De Nederlandsche Bank; CESifo (Center for Economic Studies and Ifo Institute)

Jan-Egbert Sturm

KOF Swiss Economic Institute, ETH Zurich; CESifo (Center for Economic Studies and Ifo Institute)

Date Written: April 2000

Abstract

We argue that in modelling cross-country growth models one should first identify so-called outlying observations. For the data set of Sala-i-Martin, we use the least median of squares (LMS) estimator to identify outliers. As LMS is not suited for inference, we then use reweighted least squares (RLS) for our cross-country growth models. We identify 27 variables that are significantly related to economic growth. Subsequently, applying Sala-i- Martin?s approach for the data set without outliers hardly reveals any additional information. Variables that are insignificant according to the RLS method are generally not significantly related to economic growth under the Sala-i-Martin approach.

Keywords: Sensitivity analysis, outliers, economic growth

JEL Classification: O4, C21, C52

Suggested Citation

de Haan, Jakob and Sturm, Jan-Egbert, No Need to Run Millions of Regressions (April 2000). CESifo Working Paper Series No. 288. Available at SSRN: https://ssrn.com/abstract=246453

Jakob de Haan (Contact Author)

University of Groningen - Faculty of Economics and Business ( email )

PO Box 800
Groningen, 9700 AV
Netherlands
+31 0 50 3633706 (Fax)

De Nederlandsche Bank ( email )

P.O. Box 98
Amsterdam, 1000 AB
Netherlands

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

HOME PAGE: http://www.CESifo.de

Jan-Egbert Sturm

KOF Swiss Economic Institute, ETH Zurich ( email )

Zurich
Switzerland

HOME PAGE: http://www.kof.ethz.ch

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, 81679
Germany

HOME PAGE: http://www.cesifo.de

Register to save articles to
your library

Register

Paper statistics

Downloads
198
Abstract Views
1,556
rank
153,126
PlumX Metrics