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Estimating Unobserved Individual Heterogeneity Using Pairwise Comparisons

Elena Krasnokutskaya, Kyungchul Song, Xun Tang

arXiv 4 Aug 2019 · Econometrics · publishedJournal of Econometrics (2021) · 7 citations (OpenAlex)

arXiv:1908.01272 · PDF · DOI · OpenAlex · Extracted main text

Abstract

We propose a new method for studying environments with unobserved individual heterogeneity. Based on model-implied pairwise inequalities, the method classifies individuals in the sample into groups defined by discrete unobserved heterogeneity with unknown support. We establish conditions under which the groups are identified and consistently estimated through our method. We show that the method performs well in finite samples through Monte Carlo simulation. We then apply the method to estimate a model of lowest-price procurement auctions with unobserved bidder heterogeneity, using data from the California highway procurement market.

Citation extraction

46
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69
in-text mentions
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distinct cited
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Most heavily cited references

The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.

ReferenceIntensityMentionsSectionsMain text
1Lee, Song, and Whang (2018) Testing for a General Class of Functional Inequalities0.6597186%
2Krasnokutskaya, Song, and Tang (2020) The Role of Quality in Internet Service Markets self0.5854175%
3Hu and Schennach (2008) Instrumental Variable Treatment of Nonclassical Measurement Error Models0.51121100%
4Leeb and Pötcher (2005) Model Section and Inference: Facts and Fiction0.51121100%
5Abowd, Kramarz, and Margolis (1999) High Wage Workers and High Wage Firms0.40511100%
6Andrews and Guggenberger (2009) Incorrect Asymptotic Size of Subsampling Procedures Based on Post-Consistent Model Selection Estimator0.40511100%
7Andrews and Shi (2013) Inference Based on Conditional Moment Inequalities0.40511100%
8Aradillas-Lopez, Gandhi, and Quint (2013) Identification and Inference in Ascending Auctions with Correlated Private Values0.40511100%
9Asker (2010) A Study of the Internal Organisation of a Bidding Cartel0.40511100%
10Athey and Haile (2007) Nonparametric Approaches to Auctions0.40511100%

Showing the top 10 of 48 scored citations.