Comment to "Weak instruments robust tests in GMM and the New Keynesian Phillips curve" by Frank Kleibergen and Sophocles Mavroeidis

I discuss the identifiability of a structural New Keynesian Phillips curve when it is embedded in a small scale dynamic stochastic general equilibrium model. Identification problems emerge because not all the structural parameters are recoverable from the semi-structural ones and because the objective functions I consider are poorly behaved. The solution and the moment mappings are responsible for the problems.

Inflation dynamics and the New Keynesian Phillips Curve: an identification robust econometric analysis

In this paper, we use identification-robust methods to assess the empirical adequacy of a New Keynesian Phillips Curve (NKPC) equation. We focus on the Gali and Gertler’s (1999) specification, on both U.S. and Canadian data. Two variants of the model are studied: one based on a rationalexpectations assumption, and a modification to the latter which consists in using survey data on inflation expectations. The results based on these two specifications exhibit sharp differences concerning: (i) identification difficulties, (ii) backward-looking behavior, and (ii) the frequency of price adjustments. Overall, we find that there is some support for the hybrid NKPC for the U.S., whereas the model is not suited to Canada. Our findings underscore the need for employing identificationrobust inference methods in the estimation of expectations-based dynamic macroeconomic relations.

Identification and estimation of thresholds in the fixed effects ordered logit model

This paper proposes a new estimator for the fixed effects ordered logit model. In contrast to existing methods, the new procedure allows estimating the thresholds. The empirical relevance and simplicity of implementation is illustrated in an application on the effect of unemployment on life satisfaction.

Evidence-based Economic Policy - Three Essays in Applied Microeconometrics

Over thirty years ago, Leamer (1983) - among many others - expressed doubts about the quality and usefulness of empirical analyses for the economic profession by stating that "hardly anyone takes data analyses seriously. Or perhaps more accurately, hardly anyone takes anyone else's data analyses seriously" (p.37). Improvements in data quality, more robust estimation methods and the evolution of better research designs seem to make that assertion no longer justifiable (see Angrist and Pischke (2010) for a recent response to Leamer's essay). The economic profes- sion and policy makers alike often rely on empirical evidence as a means to investigate policy relevant questions. The approach of using scientifically rigorous and systematic evidence to identify policies and programs that are capable of improving policy-relevant outcomes is known under the increasingly popular notion of evidence-based policy. Evidence-based economic policy often relies on randomized or quasi-natural experiments in order to identify causal effects of policies. These can require relatively strong assumptions or raise concerns of external validity. In the context of this thesis, potential concerns are for example endogeneity of policy reforms with respect to the business cycle in the first chapter, the trade-off between precision and bias in the regression-discontinuity setting in chapter 2 or non-representativeness of the sample due to self-selection in chapter 3. While the identification strategies are very useful to gain insights into the causal effects of specific policy questions, transforming the evidence into concrete policy conclusions can be challenging. Policy develop- ment should therefore rely on the systematic evidence of a whole body of research on a specific policy question rather than on a single analysis. In this sense, this thesis cannot and should not be viewed as a comprehensive analysis of specific policy issues but rather as a first step towards a better understanding of certain aspects of a policy question. The thesis applies new and innovative identification strategies to policy-relevant and topical questions in the fields of labor economics and behavioral environmental economics. Each chapter relies on a different identification strategy. In the first chapter, we employ a difference- in-differences approach to exploit the quasi-experimental change in the entitlement of the max- imum unemployment benefit duration to identify the medium-run effects of reduced benefit durations on post-unemployment outcomes. Shortening benefit duration carries a double- dividend: It generates fiscal benefits without deteriorating the quality of job-matches. On the contrary, shortened benefit durations improve medium-run earnings and employment possibly through containing the negative effects of skill depreciation or stigmatization. While the first chapter provides only indirect evidence on the underlying behavioral channels, in the second chapter I develop a novel approach that allows to learn about the relative impor- tance of the two key margins of job search - reservation wage choice and search effort. In the framework of a standard non-stationary job search model, I show how the exit rate from un- employment can be decomposed in a way that is informative on reservation wage movements over the unemployment spell. The empirical analysis relies on a sharp discontinuity in unem- ployment benefit entitlement, which can be exploited in a regression-discontinuity approach to identify the effects of extended benefit durations on unemployment and survivor functions. I find evidence that calls for an important role of reservation wage choices for job search be- havior. This can have direct implications for the optimal design of unemployment insurance policies. The third chapter - while thematically detached from the other chapters - addresses one of the major policy challenges of the 21st century: climate change and resource consumption. Many governments have recently put energy efficiency on top of their agendas. While pricing instru- ments aimed at regulating the energy demand have often been found to be short-lived and difficult to enforce politically, the focus of energy conservation programs has shifted towards behavioral approaches - such as provision of information or social norm feedback. The third chapter describes a randomized controlled field experiment in which we discuss the effective- ness of different types of feedback on residential electricity consumption. We find that detailed and real-time feedback caused persistent electricity reductions on the order of 3 to 5 % of daily electricity consumption. Also social norm information can generate substantial electricity sav- ings when designed appropriately. The findings suggest that behavioral approaches constitute effective and relatively cheap way of improving residential energy-efficiency.

Comparison of estimation methods of soil strength in five soils

In agriculture, the soil strength is used to describe the susceptibility to deformation by pressure caused by agricultural machine. The purpose of this study was to compare different methods for estimating the inherent soil strength and to identify their suitability for the evaluation of load support capacity, compaction susceptibility and root growth. The physical, chemical, mineralogical and intrinsic strength properties of seven soil samples, collected from five sampling pits at different locations in Brazil, were measured. Four clay (CS) and three sandy clay loam (SCL) soils were used. The clay soils were collected on a farm in Santo Ângelo, RS (28 º 16 ' 16 '' S; 54 º 13 ' 11 '' W 290 m); A and B horizons at the Universidade Federal de Lavras, Lavras, MG (21 º 13 ' 47 '' S; 44 º 58 ' 6'' W; 918 m) and on the farm Sygenta, in Uberlandia, MG (18 º 58 ' 37 '' S; 48 º 12 ' 05 '' W 866 m). The sandy clay loam soils were collected in Aracruz, ES (19 º 47 ' 10 '' S; 40 º 16 ' 29 '' W 81 m), and on the farm Xavier, Lavras, MG (21 º 13 ' 24 '' S; 45 º 05 ' 00 '' W; 844 m). Soil strength was estimated based on measurements of: (a) a pneumatic consolidometer, (b) manual pocket (non-rotating) penetrometer; and (c) automatic (rotating) penetrometer. The results of soil strength properties were similar by the three methods. The soil structure had a significant influence on soil strength. Results of measurements with both the manual pocket and the electric penetrometer were similar, emphasizing the influence of soil texture. The data showed that, to enhance the reliability of predictions of preconsolidation pressure by penetrometers, it is better to separate the soils into the different classes, rather than analyze them jointly. It can be concluded that the consolidometer method, although expensive, is the best when evaluations of load support capacity and compaction susceptibility of soil samples are desired.

The efficiency of different estimation methods of hydro-physical limits

The soil water available to crops is defined by specific values of water potential limits. Underlying the estimation of hydro-physical limits, identified as permanent wilting point (PWP) and field capacity (FC), is the selection of a suitable method based on a multi-criteria analysis that is not always clear and defined. In this kind of analysis, the time required for measurements must be taken into consideration as well as other external measurement factors, e.g., the reliability and suitability of the study area, measurement uncertainty, cost, effort and labour invested. In this paper, the efficiency of different methods for determining hydro-physical limits is evaluated by using indices that allow for the calculation of efficiency in terms of effort and cost. The analysis evaluates both direct determination methods (pressure plate - PP and water activity meter - WAM) and indirect estimation methods (pedotransfer functions - PTFs). The PTFs must be validated for the area of interest before use, but the time and cost associated with this validation are not included in the cost of analysis. Compared to the other methods, the combined use of PP and WAM to determine hydro-physical limits differs significantly in time and cost required and quality of information. For direct methods, increasing sample size significantly reduces cost and time. This paper assesses the effectiveness of combining a general analysis based on efficiency indices and more specific analyses based on the different influencing factors, which were considered separately so as not to mask potential benefits or drawbacks that are not evidenced in efficiency estimation.

Plant-available soil water capacity: estimation methods and implications

The plant-available water capacity of the soil is defined as the water content between field capacity and wilting point, and has wide practical application in planning the land use. In a representative profile of the Cerrado Oxisol, methods for estimating the wilting point were studied and compared, using a WP4-T psychrometer and Richards chamber for undisturbed and disturbed samples. In addition, the field capacity was estimated by the water content at 6, 10, 33 kPa and by the inflection point of the water retention curve, calculated by the van Genuchten and cubic polynomial models. We found that the field capacity moisture determined at the inflection point was higher than by the other methods, and that even at the inflection point the estimates differed, according to the model used. By the WP4-T psychrometer, the water content was significantly lower found the estimate of the permanent wilting point. We concluded that the estimation of the available water holding capacity is markedly influenced by the estimation methods, which has to be taken into consideration because of the practical importance of this parameter.

A comparison of three established age estimation methods on an adult Spanish sample.

Most current methods for adult skeletal age-at-death estimation are based on American samples comprising individuals of European and African ancestry. Our limited understanding of population variability hampers our efforts to apply these techniques to various skeletal populations around the world, especially in global forensic contexts. Further, documented skeletal samples are rare, limiting our ability to test our techniques. The objective of this paper is to test three pelvic macroscopic methods (1-Suchey-Brooks; 2- Lovejoy; 3- Buckberry and Chamberlain) on a documented modern Spanish sample. These methods were selected because they are popular among Spanish anthropologists and because they never have been tested in a Spanish sample. The study sample consists of 80 individuals (55 ♂ and 25 ♀) of known sex and age from the Valladolid collection. Results indicate that in all three methods, levels of bias and inaccuracy increase with age. The Lovejoy method performs poorly (27%) compared with Suchey-Brooks (71%) and Buckberry and Chamberlain (86%). However, the levels of correlation between phases and chronological ages are low and comparable in the three methods (< 0.395). The apparent accuracy of the Suchey-Brooks and Buckberry and Chamberlain methods is largely based on the broad width of the methods" estimated intervals. This study suggests that before systematic application of these three methodologies in Spanish populations, further statistical modeling and research into the co-variance of chronological age with morphological change is necessary. Future methods should be developed specific to various world populations, and should allow for both precision and flexibility in age estimation.

Estimation methods of reference evapotranspiration (ETo) for Uberlândia -MG

One approach to verify the adequacy of estimation methods of reference evapotranspiration is the comparison with the Penman-Monteith method, recommended by the United Nations of Food and Agriculture Organization - FAO, as the standard method for estimating ET0. This study aimed to compare methods for estimating ET0, Makkink (MK), Hargreaves (HG) and Solar Radiation (RS), with Penman-Monteith (PM). For this purpose, we used daily data of global solar radiation, air temperature, relative humidity and wind speed for the year 2010, obtained through the automatic meteorological station, with latitude 18° 91' 66" S, longitude 48° 25' 05" W and altitude of 869m, at the National Institute of Meteorology situated in the Campus of Federal University of Uberlandia - MG, Brazil. Analysis of results for the period were carried out in daily basis, using regression analysis and considering the linear model y = ax, where the dependent variable was the method of Penman-Monteith and the independent, the estimation of ET0 by evaluated methods. Methodology was used to check the influence of standard deviation of daily ET0 in comparison of methods. The evaluation indicated that methods of Solar Radiation and Penman-Monteith cannot be compared, yet the method of Hargreaves indicates the most efficient adjustment to estimate ETo.

Comparison of Model-Based Flow Rate Estimation Methods in Frequency-Converter-Driven Pumps and Fans

Fluid handling systems such as pump and fan systems are found to have a significant potential for energy efficiency improvements. To deliver the energy saving potential, there is a need for easily implementable methods to monitor the system output. This is because information is needed to identify inefficient operation of the fluid handling system and to control the output of the pumping system according to process needs. Model-based pump or fan monitoring methods implemented in variable speed drives have proven to be able to give information on the system output without additional metering; however, the current model-based methods may not be usable or sufficiently accurate in the whole operation range of the fluid handling device. To apply model-based system monitoring in a wider selection of systems and to improve the accuracy of the monitoring, this paper proposes a new method for pump and fan output monitoring with variable-speed drives. The method uses a combination of already known operating point estimation methods. Laboratory measurements are used to verify the benefits and applicability of the improved estimation method, and the new method is compared with five previously introduced model-based estimation methods. According to the laboratory measurements, the new estimation method is the most accurate and reliable of the model-based estimation methods.

Electrophysiological constituents of the P100 and N170 ERP complex: De-constructing of face processing using independent component analysis and robust estimation.

The initial timing of face-specific effects in event-related potentials (ERPs) is a point of contention in face processing research. Although effects during the time of the N170 are robust in the literature, inconsistent effects during the time of the P100 challenge the interpretation of the N170 as being the initial face-specific ERP effect. The interpretation of the early P100 effects are often attributed to low-level differences between face stimuli and a host of other image categories. Research using sophisticated controls for low-level stimulus characteristics (Rousselet, Husk, Bennett, & Sekuler, 2008) report robust face effects starting at around 130 ms following stimulus onset. The present study examines the independent components (ICs) of the P100 and N170 complex in the context of a minimally controlled low-level stimulus set and a clear P100 effect for faces versus houses at the scalp. Results indicate that four ICs account for the ERPs to faces and houses in the first 200ms following stimulus onset. The IC that accounts for the majority of the scalp N170 (icNla) begins dissociating stimulus conditions at approximately 130 ms, closely replicating the scalp results of Rousselet et al. (2008). The scalp effects at the time of the P100 are accounted for by two constituent ICs (icP1a and icP1b). The IC that projects the greatest voltage at the scalp during the P100 (icP1a) shows a face-minus-house effect over the period of the P100 that is less robust than the N 170 effect of icN 1 a when measured as the average of single subject differential activation robustness. The second constituent process of the P100 (icP1b), although projecting a smaller voltage to the scalp than icP1a, shows a more robust effect for the face-minus-house contrast starting prior to 100 ms following stimulus onset. Further, the effect expressed by icP1 b takes the form of a larger negative projection to medial occipital sites for houses over faces partially canceling the larger projection of icP1a, thereby enhancing the face positivity at this time. These findings have three main implications for ERP research on face processing: First, the ICs that constitute the face-minus-house P100 effect are independent from the ICs that constitute the N170 effect. This suggests that the P100 effect and the N170 effect are anatomically independent. Second, the timing of the N170 effect can be recovered from scalp ERPs that have spatio-temporally overlapping effects possibly associated with low-level stimulus characteristics. This unmixing of the EEG signals may reduce the need for highly constrained stimulus sets, a characteristic that is not always desirable for a topic that is highly coupled to ecological validity. Third, by unmixing the constituent processes of the EEG signals new analysis strategies are made available. In particular the exploration of the relationship between cortical processes over the period of the P100 and N170 ERP complex (and beyond) may provide previously unaccessible answers to questions such as: Is the face effect a special relationship between low-level and high-level processes along the visual stream?

Extending Zelterman’s approach for robust estimation of population size to zero-truncated clustered data

Estimation of population size with missing zero-class is an important problem that is encountered in epidemiological assessment studies. Fitting a Poisson model to the observed data by the method of maximum likelihood and estimation of the population size based on this fit is an approach that has been widely used for this purpose. In practice, however, the Poisson assumption is seldom satisfied. Zelterman (1988) has proposed a robust estimator for unclustered data that works well in a wide class of distributions applicable for count data. In the work presented here, we extend this estimator to clustered data. The estimator requires fitting a zero-truncated homogeneous Poisson model by maximum likelihood and thereby using a Horvitz-Thompson estimator of population size. This was found to work well, when the data follow the hypothesized homogeneous Poisson model. However, when the true distribution deviates from the hypothesized model, the population size was found to be underestimated. In the search of a more robust estimator, we focused on three models that use all clusters with exactly one case, those clusters with exactly two cases and those with exactly three cases to estimate the probability of the zero-class and thereby use data collected on all the clusters in the Horvitz-Thompson estimator of population size. Loss in efficiency associated with gain in robustness was examined based on a simulation study. As a trade-off between gain in robustness and loss in efficiency, the model that uses data collected on clusters with at most three cases to estimate the probability of the zero-class was found to be preferred in general. In applications, we recommend obtaining estimates from all three models and making a choice considering the estimates from the three models, robustness and the loss in efficiency. (© 2008 WILEY-VCH Verlag GmbH & Co. KGaA, Weinheim)