NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Moment Inequalities for Multinomial Choice with Fixed Effects

Ariel Pakes, Jack Porter

NBER Working Paper No. 21893
Issued in January 2016
NBER Program(s):Industrial Organization, Labor Studies

We propose a new approach to semiparametric analysis of multinomial choice models with fixed effects and a group (or panel) structure. A traditional random utility framework is employed, and the key assumption is a group homogeneity condition on the disturbances. This assumption places no restrictions on either the joint distribution of the disturbances across choices or within group (or across time) correlations. This work follows a substantial nonlinear panel literature (Manski 1987, Honore 1992, Abrevaya 1999, 2000) with the distinction that multiple covariate index functions now determine the outcome. A novel within-group comparison leads to a set of conditional moment inequalities that provide partial identifying information about the parameters of the observed covariate index functions, while avoiding the incidental parameter problem. We extend our framework to allow for: certain types of endogenous regressors (including lagged dependent variables and conditional heteroskedasticity), set-valued covariates, and parametric distributional information on disturbances.

download in pdf format
   (368 K)

email paper

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w21893

Users who downloaded this paper also downloaded* these:
de Ree, Muralidharan, Pradhan, and Rogers w21806 Double for Nothing? Experimental Evidence on the Impact of an Unconditional Teacher Salary Increase on Student Performance in Indonesia
Lavy, Schlosser, and Shany w21894 Out of Africa: Human Capital Consequences of In Utero Conditions
Fernández-Villaverde, Rubio Ramírez, and Schorfheide w21862 Solution and Estimation Methods for DSGE Models
Calvo, Celasun, and Kumhof w9557 Inflation Inertia and Credible Disinflation - The Open Economy Case
Budish, Roin, and Williams w21889 Patents and Research Investments: Assessing the Empirical Evidence
 
Publications
Activities
Meetings
NBER Videos
Themes
Data
People
About

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us