Using Heteroscedasticity to Identify and Estimate Mismeasured and Endogenous Regressor Models

Lewbel, Arthur

doi:10.1080/07350015.2012.643126

Cited by 1,654 publications

(1,828 citation statements)

References 36 publications

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“…Second, we probe the exclusion restriction by (a) testing for alternative channels through which aid may affect democratic change in aid-receiving and (b) relaxing the exogeneity assumption to assess how doing so influences the estimates of interest. Third, we employ "internal" model-based instruments to identify the endogenous regressor through first-stage heteroskedasticity following Lewbel (2012).…”

Section: Empirical Approachmentioning

confidence: 99%

“…The approach proposed by Lewbel (2012) identifies a two-equation model by using the presence of heteroskedasticity (or a correlation between residuals and some exogenous covariates) in the "first- stage" linear regression. Identification exploits the fact that covariance between the "first-stage" errors and the exogenous variables (X) is not necessarily zero but rather heteroskedastic.…”

Section: Identification With the Lewbel Approachmentioning

confidence: 99%

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Foreign Aid Allocation Tactics and Democratic Change in Africa

Dietrich

Wright

2015

The Journal of Politics

144

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Over the past two decades, donors increasingly link foreign aid to democracy objectives in Africa. This study investigates whether and how foreign aid influences specific outcomes associated with democratic transition and consolidation. Using an instrumental variables approach for the period from 1989 to 2008, we show that economic aid increases the likelihood of transition to multiparty politics, while democracy aid furthers democratic consolidation by reducing the incidence of multiparty failure and electoral misconduct. However, we find little evidence that either economic or democracy aid influences opposition support in multiparty elections. These findings have implications for understanding how donors allocate aid and the political consequences of foreign assistance in Africa.

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Section: Empirical Approachmentioning

confidence: 99%

Section: Identification With the Lewbel Approachmentioning

confidence: 99%

Foreign Aid Allocation Tactics and Democratic Change in Africa

Dietrich

Wright

2015

The Journal of Politics

144

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“…13 For a continuous endogenous variable, please refer to Ebbes and Bockenholt (2009), Klein and Vella (2009a), Klein and Vella (2010), and Lewbel (2012) for related approaches. See, e.g., Chung and Zhang (2015) for an application of this type of IV approach.…”

Section: Basic Set-upmentioning

confidence: 99%

Informal search, bad search?: the effects of job search method on wages among rural migrants in urban China

2017

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Any opinions expressed in this paper are those of the author(s) and not those of IZA. Research published in this series may include views on policy, but IZA takes no institutional policy positions. The IZA research network is committed to the IZA Guiding Principles of Research Integrity. The IZA Institute of Labor Economics is an independent economic research institute that conducts research in labor economics and offers evidence-based policy advice on labor market issues. Supported by the Deutsche Post Foundation, IZA runs the world's largest network of economists, whose research aims to provide answers to the global labor market challenges of our time. Our key objective is to build bridges between academic research, policymakers and society. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author. what are the underlying mechanisms. We empirically examine these issues specifically for rural migrants in urban China, a country where one of the largest domestic migration in human history has occurred over the past decades. We find that there exists a significant wage penalty for those migrant workers who have conducted their search through informal channels, despite their popularity. Our further analysis suggests two potential reasons for the wage penalty: 1) the informal job search sends a negative signal (of workers' inability to successfully find a job in a competitive market) to potential employers, resulting in lower wages; and 2) there exists a trade-off between wages and search efficiency for quicker entry into local labor market. We also find some evidence that the informal job search may lead to low-skilled jobs with lower wages. We do not find strong evidence supporting alternative explanations. Terms of use: Documents in JEL

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“…In practice, the type of restriction and the point identification strategy chosen determine the model to be used. Alternative approaches are given in Rigobon (2003), Klein and Vella (2010), Chalak and White (2011), and Lewbel (2012). However, in many empirical applications there is disagreement and concern about the exclusion restrictions imposed.…”

Section: Introductionmentioning

confidence: 99%