Mathematics, 20.03.2020 03:14 zalayjahan4793

) Consider the instrumental variable regression model Yi = β0 + β1Xi + β2Wi + ui , (1) where Xi is correlated with ui , Wi is uncorrelated with ui , and Zi is an instrument. (a) (8 points) What are the two conditions for Zi to be a valid instrumental variable?

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) Consider the instrumental variable regression model Yi = β0 + β1Xi + β2Wi + ui , (1) where Xi is c...

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