Structural interactions in spatial panels

Arnab Bhattacharjee, Sean Holly

    Research output: Contribution to journalArticle

    20 Citations (Scopus)

    Abstract

    Until recently, considerable effort has been devoted to the estimation of panel data regression models without adequate attention being paid to the drivers of interaction amongst cross-section and spatial units. We discuss some new methodologies in this emerging area and demonstrate their use in measurement and inferences on cross-section and spatial interactions. Specifically, we highlight the important distinction between spatial dependence driven by unobserved common factors and those based on a spatial weights matrix. We argue that purely factor-driven models of spatial dependence may be inadequate because of their connection with the exchangeability assumption. The three methods considered are appropriate for different asymptotic settings; estimation under structural constraints when N is fixed and T ? 8, whilst the methods based on GMM and common correlated effects are appropriate when T » N ? 8. Limitations and potential enhancements of the existing methods are discussed, and several directions for new research are highlighted.
    Original languageEnglish
    Pages (from-to)69-94
    Number of pages26
    JournalEmpirical Economics
    Volume40
    Issue number1
    DOIs
    Publication statusPublished - 1 Feb 2011

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  • Research Output

    • 20 Citations
    • 2 Working paper

    Structural Interactions in Spatial Panels

    Bhattacharjee, A. & Holly, S., 2010, St. Andrews: Centre for Dynamic Macroeconomic Analysis, 42 p. (CDMA Working Paper Series; no. CDMA10/03).

    Research output: Working paper

    Open Access
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  • Structural Interactions in Spatial Panels

    Bhattacharjee, A. & Holly, S., 2009, St. Andrews: Scottish Institute for Research in Economics , 43 p. (SIRE Discussion Papers; no. 2009-39).

    Research output: Working paper

    Open Access
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