st: RE: Endogeneity in a Panel Setting (Fixed Effects)

["Millimet, Daniel" <millimet@mail.smu.edu>]

you need a valid instrument to test endogeneity, by then comparing the exo and endo. estimates vai the durbin-wu-hausman test that is reported after ivreg2.  if one does not have valid instruments, one is in trouble.  one must rely on some other identification story such as a difference-in-differences, or diff-in-diffs-in-diffs.
 
dann

	-----Original Message----- 
	From: Asiedu, Elizabeth [mailto:asiedu@ku.edu] 
	Sent: Tue 5/27/2003 9:40 AM 
	To: 'statalist@hsphsun2.harvard.edu' 
	Cc: 
	Subject: st: Endogeneity in a Panel Setting (Fixed Effects)
	
	

	Dear all,
	
	I have an unbalanced panel of 91 countries over the period 1984-2000 (1024
	observations) and I'm using the fixed effects estimation, because it failed
	the Hausman test. I have two questions:
	
	1. How do I test whether there is endogeneity?
	
	2. I can't reliable instruments for my endogenous variable. How do I resolve
	the problem of endogeneity if it exists?
	
	
	Thank you.
	
	
	Elizabeth Asiedu
	
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