A generalized goodness-of-functional form test for binary and fractional regression models

Esmeralda Ramalho () and Joaquim Ramalho ()

CEFAGE-UE Working Papers from University of Evora, CEFAGE-UE (Portugal)

Abstract: This paper proposes a new conditional mean test to assess the validity of binary and fractional parametric regression models. The new test checks the joint significance of two simple functions of the fitted index and is based on a very flexible parametric generalization of the postulated model. A Monte Carlo study reveals a promising behaviour for the new test, which compares favourably with that of the well-known RESET test as well as with tests where the alternative model is nonparametric.

Keywords: Binary data; Fractional data; Conditional mean tests; LM tests. (search for similar items in EconPapers)
JEL-codes: C12 C25 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2013
New Economics Papers: this item is included in nep-ecm and nep-ore
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Citations: View citations in EconPapers (3)

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Related works:
Journal Article: A Generalized Goodness-of-functional Form Test for Binary and Fractional Regression Models (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:cfe:wpcefa:2013_09

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