This paper investigates the robustness of determinants of economic growth in the presence of model uncertainty, parameter heterogeneity and outliers. The robust model averaging approach introduced in the paper uses a flexible and parsimonious mixture modeling that allows for fat-tailed errors...

In many applications common in testing for convergence the number of cross-sectional units is large and the number of time periods are few. In these situations tests which are founded upon an omnibus null hypothesis are characterised by a number of problems. In this paper we consider a broad...

The authors demonstrate the conditions under which the bivariate probit model can be considered a special case of the more general multinomial probit model. Since the attendant parameter restrictions produce a singular covariance matrix, the subsequent problems of testing on the boundary of the...

We consider an alternative use of simulation in the context of using the Likelihood-Ratio statistic to test non-nested models. To date simulation has been used to estimate the Kullback-Leibler measure of closeness between two densities, which in turn ‘mean adjusts’ the Likelihood-Ratio...

In this paper we explore solutions to a particular type of heterogeneity in survey data which is manifest in the presence of individual-specific response scales. We consider this problem in the context of existing evidence on cross-country differences in subjective life satisfaction, and in...

In this paper we examine the spatial and temporal distribution of per capita income across Europe. We base our analysis on a cluster methodology which allows for an endogenous selection of regional clusters using a multivariate test for stationarity where the number and composition of clusters...

This paper examines, theoretically and empirically, the impact of reproductive externalities on fertility behaviour in Kenya. We examine this issue by identifying structural forms of social interaction operating across individuals belonging to different ethnic groups on the number of children...

In econometric analysis, non-nested models arise naturally when rival economic theories are used to explain the same phenomenon, such as unemployment, inflation or output growth. The authors examine the problem of hypothesis testing when the models under consideration are ‘non-nested’ or...

DCM (Discrete Choice Models) is a package for estimating a class of discrete choice models. Written in Ox, DCM is a class that implements a wide range of discrete choice models including standard binary response models, with notable extensions including conditional mixed logit, mixed probit,...

In models with unobserved taste heterogeneity, distributional assumptions can be placed in two ways: (1) by specifying the distribution of coefficients in the utility function and deriving the distribution of willingness to pay (wtp), or (2) by specifying the distribution of wtp and deriving the...