ECON 710 Final: ECON 710 UW Madison Final Exam 2010

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31 Jan 2019
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Final exam, spring 2010 yi = x0 i(cid:12) + ei xi = (cid:5)0zi + ui. The dimensions are: xi; ui; and (cid:12) are k (cid:2) 1; zi is (cid:2) 1 where (cid:21) k > 1; (cid:5) is (cid:2) k and yi and ei are 1 (cid:2) 1: The di culty in the problem is that (yi; xi; zi) are not jointly observed. 1 (c) find the probability limit of bq as j ! 1 (d) are the probabiltiy limits in (b) and (c) the same? (e) which estimator is more e cient: suppose you know (cid:5). Hint: use the reduced form equation for yi (a) write out this estimator. (b) which sample is used? (c) show that e(cid:12) !p (cid:12). Which sample size (n or j) goes to in(cid:133)nity for this convergence: find an estimator b(cid:5) for (cid:5) (a) write out the estimator. (b) which sample is used? (c) show that b(cid:5) !p (cid:5).

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