Question: Continuation of Exercise 12.22, based on the empiricalwork reported in Acemoglu, Johnson, and Robinson (2001). (a) Re-estimate the model estimated in part (j) by efficient

Continuation of Exercise 12.22, based on the empiricalwork reported in Acemoglu, Johnson, and Robinson (2001).

(a) Re-estimate the model estimated in part (j) by efficient GMM. Use the 2SLS estimates as the firststep for the weight matrix and then calculate the GMMestimator using this weight matrix without further iteration. Report the estimates and standard errors.

(b) Calculate and report the J statistic for overidentification.

(c) Compare the GMMand 2SLS estimates. Discuss your findings.

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