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Estimation in linear models with clustered data

Anna Mikusheva, Mikkel Sølvsten, Baiyun Jing

arXiv 18 Aug 2025 · Econometrics

arXiv:2508.12860 · PDF · DOI · OpenAlex · Extracted main text

Abstract

We study linear regression models with clustered data, high-dimensional controls, and a complicated structure of exclusion restrictions. We propose a correctly centered internal IV estimator that accommodates a variety of exclusion restrictions and permits within-cluster dependence. The estimator has a simple leave-out interpretation and remains computationally tractable. We derive a central limit theorem for its quadratic form and propose a robust variance estimator. We also develop inference methods that remain valid under weak identification. Our framework extends classical dynamic panel methods to more general clustered settings. An empirical application of a large-scale fiscal intervention in rural Kenya with spatial interference illustrates the approach.

Citation extraction

35
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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
1Arellano, Manuel and Bond, Stephen (1991) Some tests of specification for panel data: Monte Carlo evidence and an application to employment equations1.00073100%
2Egger, Dennis and Haushofer, Johannes and Miguel, Edward and Niehaus… (2022) General equilibrium effects of cash transfers: experimental evidence from Kenya0.92843100%
3Nickell, Stephen (1981) Biases in dynamic models with fixed effects0.81142100%
4Ahn, Seung C and Schmidt, Peter (1995) Efficient estimation of models for dynamic panel data0.73732100%
5Bun, Maurice J. G. and Windmeijer, Frank (2010) The weak instrument problem of the system GMM estimator in dynamic panel data models0.73732100%
6Alvarez, Javier and Arellano, Manuel (2003) The time series and cross-section asymptotics of dynamic panel data estimators0.64422100%
7Anderson, Theodore Wilbur and Hsiao, Cheng (1981) Estimation of dynamic models with error components0.64422100%
8Blattman, Christopher and Green, Donald P and Ortega, Daniel and Tob… (2021) Place-based interventions at scale: The direct and spillover effects of policing and city services on crime0.64422100%
9Jayachandran, Seema and De Laat, Joost and Lambin, Eric F and Stanto… (2017) Cash for carbon: A randomized trial of payments for ecosystem services to reduce deforestation0.64422100%
10Paluck, Elizabeth Levy and Shepherd, Hana and Aronow, Peter M (2016) Changing climates of conflict: A social network experiment in 56 schools0.64422100%

Showing the top 10 of 35 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
1Inference in clustered IV models with many and weak instruments0.40511
2Back to Feedback Dynamics and Heterogeneity in Panel Data0.40511
3Cluster-Robust Inference for Quadratic Forms0.40511