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The non-existence of instrumental variables

By P. A. V. B. Swamy, George S. Tavlas and Stephen G. Hall


The method of instrumental variables (IV) and the generalized method of moments (GMM) and their applications to the estimation of errors-in-variables and simultaneous equations models in econometrics require data on a sufficient number of instrumental variables which are (insert space) both exogeneous and relevant. We argue that in general such instruments (weak or strong) cannot exist

Publisher: Dept. of Economics, University of Leicester
Year: 2009
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