Ratios of parameter estimates are often used in econometric applications. However, the test of these ratios when estimated can cause difficulties since the ratio of asymptotically normally distributed random variables have a Cauchy distribution for which there are no finite moments. This paper...

Instructors and researchers have used the ‘flow' of knowledge (post-test score minus pre-test score) to measure learning in the classroom for the past fifty years. Walstad and Wagner (2016) and Smith and Wagner (2018) move this practice forward by disag- gregating the flow of knowledge and...

This paper develops an alternative approach for demand estimation. Taking willingness to pay as model primitive, it establishes a general and yet analytically simple demand function, and proposes an estimation procedure that uses survey to solicit consumers' willingness to pay with which the...

An explanation of the Dunning-Kruger effect is provided which does not require any psychological explanation, because it is derived as a statistical artefact. This is achieved by specifying a simple statistical model which explicitly takes the (random) boundary constraints into account. This...

The intuition behind linear regression can be difficult for students to grasp particularly without a readily accessible context. This paper uses basketball statistics to demonstrate the purpose of linear regression and to explain how to interpret its results. In particular, the student will...

In this paper R2-type measures of the explanatory power of multivariate linear and categorical probit models proposed in the literature are reviewed and their deficiencies are discussed. It is argued that a measure of the explanatory power should take into account the components which are...

We consider both a parametric and a semiparametric method to account for classification errors on the dependent variable in an ordered response model. The methods are applied to the analysis of self-reported speaking fluency of male immigrants in Germany. We find that a parametric model which...

Dagenais (1999) and Lucchetti (2002) have demonstrated that the naive GMM estimator of Grogger (1990) for the probit model with an endogenous regressor is not consistent. This paper completes their discussion by explaining the reason for the inconsistency and presenting a natural solution....

Recent empirical evidence suggests that reversing current account balances imply costly adjustment processes leading to reduced economic growth. Using large panel data sets to analyze determinants and costs of reversals asks for controls of heterogeneity among countries. This paper contributes a...

In this paper we discuss parameter identification and likelihood evaluation for multinomial multiperiod Probit models. It is shown in particular that the standard autoregressive specification used in the literature can be interpreted as a latent common factor model. However, this specification...