Numerous studies have tried to provide a better understanding of firm-level investment behaviour using econometric models. The model specification of more recent studies has been based on two main approaches. The first, the real options approach, focuses on irreversibility and uncertainty in...

This paper derives consistent standard errors for a panel Tobit model in the presence of correlated errors. The problem is framed in the context of Newey and West (1987), considering the Tobit model as a special case of a GMM estimator.

We present a simple way to estimate the effects of changes in a vector of observable variables X on a limited dependent variable Y when Y is a general nonseparable function of X and unobservables. We treat models in which Y is censored from above or below or potentially from both. The basic idea...