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Finite Sample Inference in Incomplete Models

Lixiong Li, Marc Henry

arXiv 1 Apr 2022 · Econometrics

arXiv:2204.00473 · PDF · DOI · OpenAlex · Extracted main text

Abstract

We propose confidence regions for the parameters of incomplete models with exact coverage of the true parameter in finite samples. Our confidence region inverts a test, which generalizes Monte Carlo tests to incomplete models. The test statistic is a discrete analogue of a new optimal transport characterization of the sharp identified region. Both test statistic and critical values rely on simulation drawn from the distribution of latent variables and are computed using solutions to discrete optimal transport, hence linear programming problems. We also propose a fast preliminary search in the parameter space with an alternative, more conservative yet consistent test, based on a parameter free critical value.

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54
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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
1F. Ciliberto, C. Murry, and E. Tamer (2021) Market structure and competition in airline markets1.000183100%
2A. Galichon and M. Henry (2011) Set identification in models with multiple equilibria1.000103100%
3A. Beresteanu, I. Molchanov, and F. Molinari (2011) Sharp identification regions in models with convex predictions1.00053100%
4F. Molinari (2020) Microeconometrics with partial identification1.00053100%
5V. Chernozhukov, D. Chetverikov, and K. Kato (2019) Inference on causal and structural parameters using many moment inequalities0.81142100%
6I. Ekeland, A. Galichon, and M. Henry (2010) Optimal transportation and the falsifiability of incompletely specified economic models0.81142100%
7L. Barseghyan, M. Coughlin, F. Molinari, and J. C. Teitelbaum (2021) Heterogeneous choice sets and preferences0.73732100%
8H. Kaido and Y. Zhang (2019) Robust likelihood ratio tests for incomplete economic models0.69381100%
9D. Bertsekas and S. Shreve (1996) Stochastic Optimal Control: The Discrete Time Case0.64441100%
10H. Kaido and Y. Zhang (2025) Universal inference for incomplete discrete choice models0.64441100%

Showing the top 10 of 54 scored citations.

Cited by, within the corpus

arXiv econ.EM papers that cite this one, ranked by how heavily they lean on it.

Citing paperIntensityMentionsSections
1An econometrician's guide to optimal transport0.69351
2Econometric Inference with Machine-Learned Proxies: Partial Identification via Data Combination0.64422
3Efficient Computation of Confidence Sets Using Classification on Equidistributed Grids0.51121
4Universal Inference for Incomplete Discrete Choice Models0.51121
5Set-Valued Control Functions0.40511
6Sharp Hybrid Confidence Bands for Partially Identified Treatment Effects under Tail Uncertainty with an Application to Workforce Gender Diversity and Firm Performance0.40511