CORRECTING FOR SPATIAL EFFECTS IN LIMITED DEPENDENT VARIABLE REGRESSION: ASSESSING THE VALUE OF "AD-HOC" TECHNIQUES
Alessandro (Alex) De Pinto () and
Gerald Nelson ()
No 19782, 2002 Annual meeting, July 28-31, Long Beach, CA from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)
A common test for spatial dependence in regression analysis with continuous dependent variables is the Moran's I. For limited dependent variable models, the standard definition of a residual breaks down because yi is qualitative. Efforts to correct for potential spatial effects in limited dependent variable models have relied on ad-hoc methods such as including a spatial lag variable or using a regular sample that omits neighboring observations. Kelejian and Prucha have recently developed a version of Moran's I for limited dependent variable models. We present the statistic in a more accessible way and use it to test the value of previously-used ad-hoc techniques with a specific data set. Keywords: Moran's I, Spatial Autocorrelation, Limited Dependent Variable Models, Land-Use Change, Geographical Information Systems (GIS),
Keywords: Research; Methods/; Statistical; Methods (search for similar items in EconPapers)
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