slides_Ch2_W[1]

# N1 yi o 1 xi 0 i 214 215 it goes without saying that

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Unformatted text preview: 2 & 2.13) in terms of the sample counterparts (or analogues) of E [u ] and E [xu ]. We can thus de…ne the MoM estimators as the solution to the system: ∑n=1 xi (yi βo β1 xi ) = 0 i . ∑n=1 yi βo β1 xi = 0 i Melissa Tartari (Yale) Econometrics (2.14 & 2.15) 27 / 93 The Method of Moments Approach VI More generally, the LLN allows us to rewrite the system (2.12 & 2.13) in terms of the sample counterparts (or analogues) of E [u ] and E [xu ]. We can thus de…ne the MoM estimators as the solution to the system: ∑n=1 xi (yi βo β1 xi ) = 0 i . ∑n=1 yi βo β1 xi = 0 i (2.14 & 2.15) It goes without saying that the estimators obtained as solutions to the ˆ MM ˆ MM obtained by system (2.14 & 2.15) are exactly the βo , β1 n o directly replacing the population objects µy , µx , var (x ) , cov (x , y ) in (4) with their sample counterparts. Melissa Tartari (Yale) Econometrics 27 / 93 The Method of Moments Approach VI More generally, the LLN allows us to rewrite the system (2.12 & 2.13) in terms of the sample counterparts (or analogues) of E [u ] and E [xu ]. We can thus de…ne the MoM estimators as the solution to the system: ∑n=1 xi (yi βo β1 xi ) = 0 i . ∑n=1 yi βo β1 xi = 0 i (2.14 & 2.15) It goes without saying that the estimators obtained as solutions to the ˆ MM ˆ MM obtained by system (2.14 & 2.15) are exactly the βo , β1 n o directly replacing the population objects µy , µx , var (x ) , cov (x , y ) in (4) with their sample counterparts. ˆ MM ˆ MM ... Recall, β , β o Melissa Tartari (Yale) 1 Econometrics 27 / 93 The Method of Moments Approach VI More generally, the LLN allows us to rewrite the system (2.12 & 2.13) in terms of the sample counterparts (or analogues) of E [u ] and E [xu ]. We can thus de…ne the MoM estimators as the solution to the system: ∑n=1 xi (yi βo β1 xi ) = 0 i . ∑n=1 yi βo β1 xi = 0 i (2.14 & 2.15) It goes without saying that the estimators obtained as solutions to the ˆ MM ˆ MM obtained by system (2.14 & 2.15) are exactly the βo , β1 n o direc...
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## This note was uploaded on 02/13/2014 for the course ECON 350 taught by Professor Donaldbrown during the Fall '10 term at Yale.

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