Econometrics is a field that uses economic theory and statistical methods to address empirical problems in economics. It is a tool for empirical discovery and policy analysis. The chapters in the book Handbook of Econometrics, Volume 6A embody this vision, and either implement it directly or...

The greatest problem for empirical analysis is how best to allow the context to affect the inferences. Econometric theory presupposes contextual “restrictions” that can be taken as given or assigned a probability distribution. These contextual inputs are rarely available. I illustrate this...