The conventional GMM estimator, developed for (trend.) stationary models, employs instruments that are orthogonal to the model disturbances. For the first-differenced PVAR(I) model (4. 3), such instruments are given by a constant and levels of the dependent variables, Wit, lagged two or more periods (which are predetermined). The standard orthogonality conditions are thus given by

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This paper considers the solution of multivariate linear rational expectations models. It is described how all possible classes of solutions (namely, the unique stable solution, multiple stable solutions, and the case where no stable solution exists) of such models can be characterized using the quadratic determinantal equation (QDE) method of Binder and Pesaran (1995, in M.H. Pesaran & M. Wickens [eds.], Handbook of Applied Econometrics: Macroeconomics, pp. 139–187. Oxford: Basil Blackwell). To this end, some further theoretical results regarding the QDE method expanding on previous work are presented. In addition, numerical techniques are discussed allowing reasonably fast determination of the dimension of the solution set of the model under consideration using the QDE method. The paper also proposes a new, fully recursive solution method for models involving lagged dependent variables and current and future expectations. This new method is entirely straightforward to implement, fast, and applicable also to high-dimensional problems possibly involving coefficient matrices with a high degree of singularity.

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This research addresses the extent to which political participation is a function of misinformation. A large body of work links information with participation, but relatively few authors have addressed the relationship between misinformation and participation. We use data from a 1997 random-digit-dial survey of 810 adults in San Diego to test the hypothesis that misinformation (confident beliefs in false facts) is associated with political participation even after controlling for other explanations, including information. We find that while both misinformation and information tend to increase participation levels, their specific impacts vary. This research ends a period of speculation by presenting empirical evidence of misinformed participation for the first time in the literature.