Testing for Serial Correlation by Variable Addition in Dynamic Models Estimated by Instrumental Variables.

A-Tier
Journal: Review of Economics and Statistics
Year: 1994
Volume: 76
Issue: 3
Pages: 550-59

Score contribution per author:

4.022 = (α=2.01 / 1 authors) × 2.0x A-tier

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

Abstract

Instrumental variable tests for serial correlation can be carried out by adding lagged residuals from initial estimation to the regressors of the model under scrutiny and then checking their joint significance. It is shown that asymptotically valid tests are obtained if the lagged residuals are also added to the initial instrument set. Monte Carlo evidence suggests that useful improvements in finite sample behavior under null and alternative hypotheses can be produced when the instrument set is extended to include the relevant lagged residuals. Links with other tests are discussed and a modification allowing for conditional heteroskedasticity is described. Copyright 1994 by MIT Press.

Technical Details

RePEc Handle
repec:tpr:restat:v:76:y:1994:i:3:p:550-59
Journal Field
General
Author Count
1
Added to Database
2026-01-25