An Empirical Investigation into the Causes of Economic Growth in the Third World Using Full Information Maximum Likelihood Estimators

Ira Saltz and Richard Cebula ()

MPRA Paper from University Library of Munich, Germany

Abstract: Many empirical studies of economic growth in Third World countries are cross-national studies that have adopted single-equation OLS estimation to identify the determinants of economic growth. The problem with such an approach is that it often suffers from simultaneity bias. The present study adopts Full Information Maximum Likelihood Estimators. The analysis in this paper reveals that simultaneity must not be dismissed and that the conclusions drawn from standard OLS analysis are to be interpreted carefully and in many cases not taken seriously.

Keywords: simultaneity bias; full information maximum likelihood estimators (search for similar items in EconPapers)
JEL-codes: D24 E22 O41 O57 (search for similar items in EconPapers)
Date: 1997-09-11
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Citations: View citations in EconPapers (1)

Published in The Indian Journal pof Economics 4.79(1999): pp. 435-451

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