Artikel
Consistent estimation in pseudo panels in the presence of selection bias
In the presence of selection bias the traditional estimators for pseudo panel data models are inconsistent. This paper discusses a method to achieve consistency in static linear pseudo panels in the presence of selection bias and a testing procedure for sample selection bias. The authors' approach uses a bias correction term proportional to the inverse Mills ratio with argument equal to the "normit" of a consistent estimation of the conditional probability of being observed given cohort membership. Monte Carlo analysis shows the test does not reject the null for fixed T at a 5% significance level in finite samples. As a "side effect" the authors utilize the enlarged pseudo panel to provide a GMM consistent estimation of the pseudo panel parameters under rejection of the null and apply the procedure to estimate the rate of return to education in Colombia.
- Language
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Englisch
- Bibliographic citation
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Journal: Economics: The Open-Access, Open-Assessment E-Journal ; ISSN: 1864-6042 ; Volume: 8 ; Year: 2014 ; Issue: 2014-43 ; Pages: 1-25 ; Kiel: Kiel Institute for the World Economy (IfW)
- Classification
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Wirtschaft
Statistical Simulation Methods: General
Single Equation Models; Single Variables: Panel Data Models; Spatio-temporal Models
Model Evaluation, Validation, and Selection
Returns to Education
- Subject
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Repeated cross-section models
selectivity bias testing
returns to education
- Event
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Geistige Schöpfung
- (who)
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Mora, Jhon James
Muro, Juan
- Event
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Veröffentlichung
- (who)
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Kiel Institute for the World Economy (IfW)
- (where)
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Kiel
- (when)
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2014
- DOI
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doi:10.5018/economics-ejournal.ja.2014-43
- Handle
- Last update
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10.03.2025, 11:43 AM CET
Data provider
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ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Artikel
Associated
- Mora, Jhon James
- Muro, Juan
- Kiel Institute for the World Economy (IfW)
Time of origin
- 2014
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