Local Identification of Nonparametric and Semiparametric Models.

In parametric, nonlinear structural models, a classical sufficient condition for local identification, like Fisher (1966) and Rothenberg (1971), is that the vector of moment conditions is differentiable at the true parameter with full rank derivative matrix. We derive an analogous result for the non...

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Published in:Econometrica Vol. 82; no. 2; pp. 785 - 810
Main Authors: Chen, Xiaohong, Chernozhukov, Victor, Lee, Sokbae, Newey, Whitney K.
Format: Article
Published: Wiley-Blackwell Mar2014
Subjects:
Online Access:View this record in EBSCOhost
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      dt: Mar2014
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      pub: Wiley-Blackwell
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        95322764
        10.3982/ECTA9988
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      tig:
        atl: Local Identification of Nonparametric and Semiparametric Models.
      aug:
        au:
          Chen, Xiaohong
          Chernozhukov, Victor
          Lee, Sokbae
          Newey, Whitney K.
        affil:
          Dept. of Economics, Yale University, Box 208281, New Haven, CT 06520, U.S.A.;
          Dept. of Economics, MIT, Cambridge, MA 02142, U.S.A.;
          Dept. of Economics, Seoul National University, 1 Gwanak-ro, Gwanak-gu, Seoul, 151-742, Respublic of Korea;
      su:
        Nonparametric estimation
        Identification (Statistics)
        Structural frame models
        Nonlinear theories
        Instrumental variables (Statistics)
      sug:
        subj:
          Nonparametric estimation
          Identification (Statistics)
          Structural frame models
          Nonlinear theories
          Instrumental variables (Statistics)
      keyword:
        asset pricing
        Identification
        local identification
        nonparametric models
        asset pricing
        Identification
        local identification
        nonparametric models
      ab: In parametric, nonlinear structural models, a classical sufficient condition for local identification, like Fisher (1966) and Rothenberg (1971), is that the vector of moment conditions is differentiable at the true parameter with full rank derivative matrix. We derive an analogous result for the nonparametric, nonlinear structural models, establishing conditions under which an infinite dimensional analog of the full rank condition is sufficient for local identification. Importantly, we show that additional conditions are often needed in nonlinear, nonparametric models to avoid nonlinearities overwhelming linear effects. We give restrictions on a neighborhood of the true value that are sufficient for local identification. We apply these results to obtain new, primitive identification conditions in several important models, including nonseparable quantile instrumental variable (IV) models and semiparametric consumption-based asset pricing models.
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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