It is well-known that size-adjustments based on Edgeworth expansions for the t-statistic perform poorly when instruments are weakly correlated with the endogenous explanatory variable. This paper shows, however, that the lack of Edgeworth expansions and bootstrap validity are not tied to the...

Measurement of seat belt and air bag effectiveness is complicated by the fact that systematic data are collected only for crashes in which a fatality occurs. These data suffer from sample selection since seat belt and air bag usage influences survival rates which in turn determine whether a...

Measuring the relative likelihood of fatal crash involvement for different types of drivers would seem to require information on both the number of fatal crashes by driver type and the fraction of drivers on the road falling into each category. In this paper, however, we present a methodology...

In this paper, we investigate the problem of estimating distributed lags in short panels. Estimates of the parameter of distributed lag relationships based on single time-series of observations have been usually rather imprecise. The promise of panel data is in the N repetitions of the...

This paper presents an operational meaning to the concept of the variance in lifetime income in terms of the discounted variance of T mutually uncorrelated, sequentially realized, random variables. It is then shown how the logical implications of the lifecycle consumption model can be used to...

It is known that innovations in the market value of manufacturing firms and their RhD expenditures are related (Pakes (1985) and Mairesse and Siu (1984)). This could be due to shifts in the demand for the output of a particular firm, to shifts in the technological opportunities available to the...

In neoclassical models of consumption choice under earnings uncertainty changes in consumption programs from one period to the next are determined by new information received about future earnings over the period. This proposition suggests testing the neoclassical model by ascertaining whether...

Most of the theoretical work on collusion and price wars assumes identical firms and an unchanging environment, assumptions which are at odds with what we know about most industries. Further that literature focuses on the impact of collusion on prices. Whether an industry can support collusion...

This paper outlines a framework which computes and analyzes the equilibria from a class of dynamic games. The framework dates to Ericson and Pakes (1995), and allows for a finite number of heterogeneous firms, sequential investments with stochastic outcomes, and entry and exit. The equilibrium...

This paper summarizes a number of studies which use patent data to examine different aspects of technological change. It describes our firm level data set construction effort; reports on the relationship between RLD expenditures and the level of patenting; analyzes the relationship between...