Set Identified Linear Models
Abstract
We analyze the identification and estimation of parameters β satisfying the incomplete linear moment restrictions E(z T (x βây)) = E(z Tu(z)) where z is a set of instruments and u(z) an unknown bounded scalar function. We first provide empirically relevant examples of such a set-up. Second, we show that these conditions set identify β where the identified set B is bounded and convex. We provide a sharp characterization of the identified set not only when the number of moment conditions is equal to the number of parameters of interest but also in the case in which the number of conditions is strictly larger than the number of parameters. We derive a necessary and sufficient condition of the validity of supernumerary restrictions which generalizes the familiar Sargan condition. Third, we provide new results on the asymptotics of analog estimates constructed from the identification results. When B is a strictly convex set, we also construct a test of the null hypothesis, β 0 ε B, whose size is asymptotically correct and which relies on the minimization of the support function of the set B â { β 0 }. Results of some Monte Carlo experiments are presented.(This abstract was borrowed from another version of this item.)
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Paper provided by Institut d'Économie Industrielle (IDEI), Toulouse in its series IDEI Working Papers with number 494.Length:
Date of creation: Dec 2007
Date of revision:
Publication status: Published in Econometrica, vol. 80, n°3, mai 2012, p. 1129-1155.
Handle: RePEc:ide:wpaper:8519
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- Christian Bontemps & Thierry Magnac & Eric Maurin, 2012. "Set Identified Linear Models," Econometrica, Econometric Society, vol. 80(3), pages 1129-1155, 05.
- Bontemps, Christian & Magnac, Thierry & Maurin, Eric, 2009. "Set Identified Linear Models," TSE Working Papers 09-090, Toulouse School of Economics (TSE).
- Christian Bontemps & Thierry Magnac & Eric Maurin, 2011. "Set identified linear models," CeMMAP working papers CWP13/11, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
- NEP-ALL-2008-01-05 (All new papers)
- NEP-ECM-2008-01-05 (Econometrics)
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Donald W.K. Andrews & Xiaoxia Shi, 2010.
"Inference Based on Conditional Moment Inequalities,"
Cowles Foundation Discussion Papers
1761, Cowles Foundation for Research in Economics, Yale University.
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Cowles Foundation Discussion Papers
1676, Cowles Foundation for Research in Economics, Yale University.
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