Question
How do you test if an instrument is weak? A. Determining whether the R-squared statistic for the IV model increases when the instrument is used.
How do you test if an instrument is weak?
A. Determining whether the R-squared statistic for the IV model increases when the instrument is used.
B. Regressing x on z, performing an F test of the hypothesis that the coefficient on z is zero, and then calculating 1/F.
C. Regressing x on z and determining whether the slope coefficient on z exceeds 0.01.
D. Performing a t-test of the Levitt-Angrist statistic.
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Managerial Economics and Organizational Architecture
Authors: James Brickley, Clifford W. Smith Jr., Jerold Zimmerman
6th edition
73523143, 73523149, 978-0073523149
