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The Stata Journal
Volume 18 Number 3: pp. 663-691



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Practical considerations for questionable IVs

Damian Clarke
Department of Economics
Universidad de Santiago de Chile
damian.clarke@usach.cl
Benjamín Matta
Department of Economics
Universidad de Santiago de Chile
benjamin.matta@usach.cl
Abstract.  In this article, we examine several techniques that allow for the construction of bounds estimates based on instrumental variables, even when the instruments are not valid. We introduce the plausexog and imperfectiv commands, which implement methods described by Conley, Hansen, and Rossi (2012, Review of Economics and Statistics 94: 260–272) and Nevo and Rosen (2012b, Review of Economics and Statistics 94: 659–671). We examine the performance of these bounds under a range of circumstances, which leads to several practical results related to the informativeness of the bounds in different situations.
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View all articles by these authors: Damian Clarke, Benjamín Matta

View all articles with these keywords: plausexog, imperfectiv, instrumental variables, exclusion restrictions, invalidity, plausibly exogenous, imperfect IVs

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