LM tests for spatial correlation in spatial models with limited dependent variables

Xi Qu and Lung-Fei Lee

Regional Science and Urban Economics, 2012, vol. 42, issue 3, 430-445

Abstract: Models of limited dependent variables are of great interest in econometrics. This paper focuses on the specification and hypothesis test of spatial models which have a Tobit structure. We derive an extended central limit theorem for statistics of a linear–quadratic form with multivariate random variables. We consider the LM statistics for testing spatial correlation and establish their asymptotic distributions. The tests are applied to an empirical example: we detect the presence of competition among school districts on school district income tax in Iowa.

Keywords: Spatial econometric models; LM tests; Limited dependent variables (search for similar items in EconPapers)
JEL-codes: C12 R50 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (23)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:regeco:v:42:y:2012:i:3:p:430-445

DOI: 10.1016/j.regsciurbeco.2011.11.001

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