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Qin, Duo (2018) 'Let's take the bias out of econometrics.' Journal of Economic Methodology, 26 (2). pp. 81-98.

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Abstract

This study exposes the cognitive flaws of ‘endogeneity bias’. It examines how conceptualisation of the bias has evolved to embrace all major econometric problems, despite extensive lack of hard evidence. It reveals the crux of the bias – a priori rejection of causal variables as conditionally valid ones, and of the bias correction by consistent estimators – modification of those variables by non-uniquely and non-causally generated regressors. It traces the flaws to misconceptions about error terms and estimation consistency. It highlights the need to shake off the bias to let statistical learning play an active and formal role in econometrics. JEL classification: B23, B40, C10, C50

Item Type: Journal Article
Keywords: simultaneity, omitted-variable bias, self-selection, consistency, causality
SOAS Departments & Centres: Departments and Subunits > Department of Economics
ISSN: 14699427
Copyright Statement: © 2018 Informa UK Limited, trading as Taylor & Francis Group. This is an Accepted Manuscript of an article published by Taylor & Francis in Journal of Economic Methodology on 19 Nov 2018, available online: http://www.tandfonline.com/10.1080/1350178X.2018.1547415
DOI (Digital Object Identifier): https://doi.org/10.1080/1350178X.2018.1547415
Date Deposited: 20 Aug 2018 09:45
URI: https://eprints.soas.ac.uk/id/eprint/26275

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