This paper examines panel data modelling with latent variables in analyzing log-linear relations between inputs and output of firms. Our particular focus is on (i) the "increasing returns to scale puzzle" for labour input and (ii) the GMM estimation in the context of errors-in-variables and...

General Method of Moments (GMM) estimation of a linear one-equation model using panel data with errors-in-variables is considered. To eliminate fixed individual heterogeneity, the equation is differenced across one or more than one periods and estimated by means of instrumental variables. With...

This paper examines panel data modelling with latent variables in analyzing log-linear relations between inputs and output of firms. Our particular focus is on (i) the "increasing returns to scale puzzle" for labour input and (ii) the GMM estimation in the context of errors-in-variables and...

General Method of Moments (GMM) estimation of a linear one-equation model using panel data with errors-in-variables is considered. To eliminate fixed individual heterogeneity, the equation is differenced across one or more than one periods and estimated by means of instrumental variables. With...