Inference in ordered response games with complete information

Arbeitspapier

We study econometric models of complete information games with ordered action spaces, such as the number of store fronts operated in a market by a firm, or the daily number of flights on a city-pair offered by an airline. The model generalises single agent models such as ordered probit and logit to a simultaneous model of ordred response. We characterise identified sets for model parameters under mild shape restrictions on agents' payoff functions. We then propose a novel inference method for a parametric version of our model based on a test statistic that embeds conditional moment inequalities implied by equilibrium behaviour. Using maximal inequalities for U-processes, we show that an asymptotically valid confidence set is attained by employing an easy to compute fixed critical value, namely the appropriate quantile of a chi-square random variable. We apply our method to study capacity decisions measured as the number of stores operated by Lowe's and Home Depot in geographic markets. We demonstrate how our confidence sets for model parameters can be used to perform inference on other quantities of economic interest, such as the probability that any given outcome is an equilibrium and the propensity with which any particular outcome is selected when it is one of multiple equilibria.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: cemmap working paper ; No. CWP33/13

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Econometrics ; Multiple or Simultaneous Equation Models: Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models ; Multiple or Simultaneous Equation Models: Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
• Thema: Discrete games ; ordered response ; partial identification ; conditional moment inequalities

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Aradillas-Lopez, Andrew ; Rosen, Adam
• Ereignis: Veröffentlichung
• (wer): Centre for Microdata Methods and Practice (cemmap)
• (wo): London
• (wann): 2013

Weitere Informationen

• DOI: doi:10.1920/wp.cem.2013.3313
• Handle: http://hdl.handle.net/10419/79554
• Letzte Aktualisierung: 10.03.2025, 11:44 MEZ