We take a fresh look at Theil's BLUS residuals and ask why they have gone out of fashion.All our simulation experiments indicate that tests based on BLUS residuals have higher power than those based on the more popular recursive residuals, even in those cases (structural breaks) where intuition...

This paper develops a dynamic model consisting of two regions (North and South), in which the accumulation of human capital is negatively influenced by the global stock of pollution. By characterizing the equilibrium strategy of each region, we show that the regions’ best responses can be...

We consider the question whether top tennis players in a top tournament (Wimbledon) employ an optimal (efficient) service strategy. While we show that top players do not, in general, follow an optimal strategy, our principal result is that the estimated inefficiencies are not large: the...

Under normality, the Bayesian estimation problem, the best linear unbiased estimation problem, and the restricted least-squares problem are all equivalent. As a result we need not compute pseudo-inverses and other complicated functions, which will be impossible for large sparse systems. Instead,...