What is meant by the identification problem, Microeconomics

Assignment Help:

1. What is simultaneous biases? Discuss the cause of ednoginity in regression analysis.

2. Explains concisely what is meant by ' the identification problem'' in the context of liner simultaneous equation model.

3. 

1678_What is meant by the identification problem.png

4. i) Consider the identifiability of each of the equations in the following model

(use rank and order conditions):

2127_What is meant by the identification problem2.png

where:

C(consumption), I(investment), T (taxation), Y(income) are endogenous variables; G(government expenditure) is exogenous; U, V and W are random disturbance terms.

ii) What problems arise in the interpretation of the coefficient estimates of equations that are not identified?

(iii) Why do simultaneous equations violate the classical assumption of independence between the error term and the explanatory variables?

(iv)  What happens if OLS is used to estimate the coefficients of a simultaneous system?

(vii) What is Two-Stage Least Squares? What are the properties of Two-Stage Least Squares?


Related Discussions:- What is meant by the identification problem

...., Homework 4 Q1. Suppose a consumer has utility function (u) = xy where...

Homework 4 Q1. Suppose a consumer has utility function (u) = xy where x and y are amounts of two commodities that this consumer consume. Suppose this consumer’s income is $120, pri

Externalities, what is externalities and market inefficiency

what is externalities and market inefficiency

Define regulation and it’s problems , Regulation is not a panacea.  There a...

Regulation is not a panacea.  There are troubles with rate regulation.  In our litigious society, the legal proceedings contained in rate regulation are not inexpensive for any of

possibility production curve, how does the concept of possibility producti...

how does the concept of possibility production curve aplicable in real life?

Calculate revenue, Question 1  (9 marks) During the 1990s, technologi...

Question 1  (9 marks) During the 1990s, technological advance reduced the cost of computer chips.  Explain, with the use of supply and demand diagrams, how the following mark

Individual demand - substitutes and complements, Individual Demand Sub...

Individual Demand Substitutes and Complements 1) The two goods are considered substitutes if an increase (decrease) in price of one lead to an increase (decrease) in quant

Help, A monopolist faces the inverse demand for its output: p = 30 – Q The ...

A monopolist faces the inverse demand for its output: p = 30 – Q The monopolist also has a constant marginal and average cost of $4/unit. The government is seeking ways to collect

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd