A discrete or continuous outcome is determined by a structural function in which the effect of some variables of interest is transmitted through a scalar index. Multiple sources of stochastic variation can appear as arguments of the structural function, but not in the index. There may be endogeneity, that is observable and unobservable variables may not be independently distributed. Conditions are provided under which there is local identification of measures of the relative sensitivity of the index to variations in pairs of its possibly endogenous arguments, namely ratios of partial derivatives of the index.
Authors
Research Fellow University College London
Andrew is the Director of the ESRC Centre for Microdata Methods and Practice (cemmap) and Professor of Economics and Economic Measurement at UCL.
Journal article details
- DOI
- 10.1016/j.jeconom.2009.02.004
- Publisher
- Elsevier
- Issue
- Volume 152, Issue 1, September 2009
Suggested citation
Chesher, A. (2009). 'Excess heterogeneity, endogeneity and index restrictions' 152(1/2009)
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