Testing for Selectivity Bias in Panel Data Models
The authors discuss several tests to check for the presence of selectivity bias in estimators based on panel data. One approach to test for selectivity bias is to specify the selection mechanism explicitly and estimate it jointly with the model of interest. Alternatively, one can derive the asymptotically efficient Lagrange multiplier test. Both approaches are computationally demanding. In this paper, the authors propose the use of simple variable addition and (quasi-) Hausman tests for selectivity bias that do not require any knowledge of the response process. They compare the power of these tests with the asymptotically efficient test using Monte Carlo methods. Copyright 1992 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.
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Volume (Year): 33 (1992)
Issue (Month): 3 (August)
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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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- Nijman, T.E. & Verbeek, M.J.C.M., 1989. "The nonresponse bias in the analysis of the determinants of total annual expenditures of households based on panel data," Discussion Paper 1989-36, Tilburg University, Center for Economic Research.
- Charles F. Manski, 1989. "Anatomy of the Selection Problem," Journal of Human Resources, University of Wisconsin Press, vol. 24(3), pages 343-360.
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