Bootstrapping structural change tests

A-Tier
Journal: Journal of Econometrics
Year: 2019
Volume: 213
Issue: 2
Pages: 359-397

Authors (3)

Boldea, Otilia (Universiteit van Tilburg) Cornea-Madeira, Adriana (not in RePEc) Hall, Alastair R. (not in RePEc)

Score contribution per author:

1.341 = (α=2.01 / 3 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

This paper demonstrates the asymptotic validity of methods based on the wild recursive and wild fixed bootstraps for testing hypotheses about discrete parameter change in linear models estimated via Two Stage Least Squares. The framework allows for the errors to exhibit conditional and/or unconditional heteroscedasticity, and for the reduced form to be unstable. Simulation evidence indicates the bootstrap tests yield reliable inferences in the sample sizes often encountered in macroeconomics. If the errors exhibit unconditional heteroscedasticity and/or the reduced form is unstable then the bootstrap methods are particularly attractive because the limiting distributions of the test statistics are not pivotal.

Technical Details

RePEc Handle
repec:eee:econom:v:213:y:2019:i:2:p:359-397
Journal Field
Econometrics
Author Count
3
Added to Database
2026-01-24