Hello all.
I'm currently working on my final year dissertation and have some questions to ask regarding diagnostic tests and robustness checks for instrumental variable regressions. My dependent variable is the log(GDP), the instrumented variable is the log(number of inbound tourists) and the instruments are ordinal variables on the ratification status of an agreement, split into 3 levels.
Please help as I'm not sure how to verify if my data is useful or if the assumptions are met.
Thank you in advance!
I'm currently working on my final year dissertation and have some questions to ask regarding diagnostic tests and robustness checks for instrumental variable regressions. My dependent variable is the log(GDP), the instrumented variable is the log(number of inbound tourists) and the instruments are ordinal variables on the ratification status of an agreement, split into 3 levels.
Please help as I'm not sure how to verify if my data is useful or if the assumptions are met.
Thank you in advance!
