 Estimating an economic model of crime using panel data from North CarolinaJournal of Applied Econometrics, 2006, vol. 21, issue 4, 543-547 Abstract: This paper replicates the Cornwell and Trumbull (1994) estimation of a crime model using panel data on 90 counties in North Carolina over the period 1981–1987. While the Between and Within estimates are replicated, the fixed effects 2SLS as well as the 2SLS estimates are not. In fact, the fixed effects 2SLS estimates turn out to be insignificant for all important deterrent variables as well as legal opportunity variables. We argue that the usual Hausman test, based on the difference between fixed effects and random effects, may lead to misleading inference when endogenous variables of the conventional simultaneous equation type are among the regressors. We estimate the model using random effects 2SLS and perform a Hausman test based on the difference between fixed effects 2SLS and random effects 2SLS. We cannot reject the consistency of the random effects 2SLS estimator and this estimator yields plausible and significant estimates of the crime model. This result should be tempered by the legitimacy of the chosen instruments. Copyright © 2006 John Wiley & Sons, Ltd. Date: 2006 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:wly:japmet:v:21:y:2006:i:4:p:543-547 Ordering information: This journal article can be ordered from Access Statistics for this article Journal of Applied Econometrics is currently edited by M. Hashem Pesaran More articles in Journal of Applied Econometrics from John Wiley & Sons, Ltd. |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.