Structural Models, Information and Inherited Restrictions
Andrew Buck () and
George Lady ()
Additional contact information
George Lady: Department of Economics, Temple University
No 1103, DETU Working Papers from Department of Economics, Temple University
The derived structural estimates of the system beta Y = gamma Z | delta U impose identifying restrictions on the reduced form estimates ex post. Some or all of the derived structural estimates are presented as evidence of the modelâ€™s efficacy. In fact, the reduced form inherits a great deal of information from the structureâ€™s restrictions and hypothesized sign patterns, limiting the allowable signs for the reduced form. A method for measuring a structural modelâ€™s statistical information content is proposed. Further, the paper develops a method for enumerating the allowable reduced form outcomes which can be used to falsify the proposed model independently of significant coefficients found for the structural relations.
Keywords: Qualitative Analysis; Structural Form; Reduced Form; Identification; Model Falsification; Entropy (search for similar items in EconPapers)
JEL-codes: C15 C18 C51 C52 (search for similar items in EconPapers)
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http://www.cla.temple.edu/RePEc/documents/detu_11_03.pdf First version, 2011 (application/pdf)
Journal Article: Structural models, information and inherited restrictions (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:tem:wpaper:1103
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