UNDERSTANDING REGRESSION VERSUS VARIANCE TESTS FOR SOCIAL INTERACTIONS

Steven Durlauf and Hisatoshi Tanaka

Economic Inquiry, 2008, vol. 46, issue 1, 25-28

Abstract: This article considers the relationship between the use of regressions and the use of variance contrast methods to uncover social interactions. We illustrate how these methods employ different identifying assumptions and are therefore complementary approaches. We also provide formal identification results that extend existing ones for the two methods. (JEL C12, C21, C23, Z13)

Date: 2008
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https://doi.org/10.1111/j.1465-7295.2007.00076.x

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