Improved Coefficient and Variance Estimation in Stable First-Order Dynamic Regression Models

In dynamic regression models the least-squares coefficient estimators are biased in finite samples, and so are the usual estimators for the disturbance variance and for the variance of the coefficient estimators. By deriving the expectation of the initial terms in an expansion of the usual expression for the asymptotic coefficient variance estimator and by comparing these with an approximation to the true variance we find an approximation to the bias in variance estimation from which a bias corrected estimator for the variance readily follows. This is also achieved for a bias corrected coefficient estimator and allows to compare analytically the second-order approximation to the mean squared error of the least-squares estimator and its counterpart for the first-order bias corrected coefficient estimator. Two rather strong results on efficiency gains through bias correction for AR(1) models follow. Illustrative simulation results on the magnitude of bias in coefficient and variance estimation and on the scope for effective bias correction and efficiency improvement are presented for some relevant particular cases of the ARX(1) class of models.

Identification and inference in a simultaneous equation under alternative information sets and sampling schemes

In simple static linear simultaneous equation models, the empirical distributions of IV and OLS are examined under alternative sampling schemes and compared with their first-order asymptotic approximations. We demonstrate that the limiting distribution of consistent IV is not affected by conditioning on exogenous regressors, whereas that of inconsistent OLS is. The OLS asymptotic and simulated actual variances are shown to diminish by extending the set of exogenous variables kept fixed in sampling, whereas such an extension disrupts the distribution of IV and deteriorates the accuracy of its standard asymptotic approximation, not only when instruments are weak. Against this background, the consequences for the identification of parameters of interest are examined for a setting in which (in practice often incredible) assumptions regarding the zero correlation between instruments and disturbances are replaced by (generally more credible) interval assumptions on the correlation between endogenous regressor and disturbance. This yields OLS-based modified confidence intervals, which are usually conservative, as is established by simulation. Often they compare favourably with IV-based intervals and accentuate their frailty. The latter is demonstrated in an empirical illustration

Identification and Inference in a Simultaneous Equation Under Alternative Information Sets and Sampling Schemes

In simple static linear simultaneous equation models the empirical distributions ofIV and OLS are examined under alternative sampling schemes and compared with their first-order asymptotic approximations. It is demonstrated why in this context the limiting distribution of a consistent estimator is not a¤ected by conditioning on exogenous regressors, whereas that of an inconsistent estimator is. The asymptotic variance and the simulated actual variance of the inconsistent OLS estimator are shown to diminish by extending the set of exogenous variables kept fixed in sampling, whereas such an extension disrupts the distribution of consistent IV estimation and deteriorates the accuracy of its standard asymptotic approximation, not only when instruments are weak. Against this background the consequences for the identification of the parameters of interest are examined for a setting in which (in practice often incredible) assumptions regarding the zero correlation between instruments and disturbances are replaced by (generally more credible) interval assumptions on the correlation between endogenous regressors and disturbances. This leads to a feasible procedure for constructing purely OLS-based robust confidence intervals, which yield conservative coverage probabilities in finite samples, and often outperform IV-based intervals regarding their length

Dynamic metabolic control: towards precision engineering of metabolism

Advances in metabolic engineering have led to the synthesis of a wide variety of valuable chemicals in microorganisms. The key to commercializing these processes is the improvement of titer, productivity, yield, and robustness. Traditional approaches to enhancing production use the “push–pull-block” strategy that modulates enzyme expression under static control. However, strains are often optimized for specific laboratory set-up and are sensitive to environmental fluctuations. Exposure to sub-optimal growth conditions during large-scale fermentation often reduces their production capacity. Moreover, static control of engineered pathways may imbalance cofactors or cause the accumulation of toxic intermediates, which imposes burden on the host and results in decreased production. To overcome these problems, the last decade has witnessed the emergence of a new technology that uses synthetic regulation to control heterologous pathways dynamically, in ways akin to regulatory networks found in nature. Here, we review natural metabolic control strategies and recent developments in how they inspire the engineering of dynamically regulated pathways. We further discuss the challenges of designing and engineering dynamic control and highlight how model-based design can provide a powerful formalism to engineer dynamic control circuits, which together with the tools of synthetic biology, can work to enhance microbial production

ECONOMETRIC ANALYSIS OF PANEL DATA: EDITORIAL INTRODUCTION

No abstract received.

The Asymptotic and Finite Sample Distributions of OLS and Simple IV in Simultaneous Equations

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