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  • 标题:Comparative Study of Estimators in Autocorrelated-Endogenized Linear Model
  • 本地全文:下载
  • 作者:Olutunji John Olaomi ; Dahud Kehinde Shangodoyin
  • 期刊名称:Interstat
  • 印刷版ISSN:1941-689X
  • 出版年度:2010
  • 期号:May
  • 出版社:Virginia Tech
  • 摘要:

    This study compares the estimators of linear model when the least square assumptions of independence of the error terms and the zero correlation between the regressor and the error terms are violated using a Monte Carlo experiment. OLS, OLSA, 2SLS and 2SLSA estimators were considered in 10,000 replications of the experiment on single equation model where the error terms are AR(1) autocorrelated and at the same time significantly correlated with the regressor(endogeneity). We consider autocorrelation levels 0.4, 0.8 and 0.9, endogeneity levels between the regressor and the error terms at 0.01, 0.02 and 0.05 each at the sample size (N) 20, 40 and 60. The estimators are adjudged using the RMSE criterion on the 108 scenarios. The result shows that 2SLS perform best when N<=40 at all autocorrelation and endogeneity levels. OLSA is the best estimator when N is large (N = 60) and autocorrelation level is <= 0.8, while 2SLSA performs best when N and autocorrelation level are large, at all endogeneity levels. All estimators perform worse as autocorrelation level increases while they perform better asymptotically and with increase in significant level

  • 关键词:Monte-Carlo Experiment; Endogeneity; 2SLS; OLS; Autocorrelation
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