Paul A. Ruud, Sufficient Conditions for the Consistency of Maximum Likelihood Estimation Despite Misspecification of Distribution in Multinomial Discrete Choice Models, Econometrica, Vol. 51, No. 1 (Jan., 1983), pp. 225-228

Estimation of limited dependent variable models with dependent observations has received relatively little attention due to the computational complexity of the maximum likelihood estimator. We develop a computationally attractive and relatively efficient estimator for this case that utilises the orthogonality conditions. The resulting Generalized Conditional Moment (GCM) estimators can be applied with a known or an unknown disturbance covariance matrix. Although the paper considers only the probit model, the approach is easily generalized to other limited dependent variable models.

The authors extend Daniel McFadden's (1989) method of simulated moments to approximating efficient estimators in general estimation problems. The general approach applies a simulated bias correction to an approximation of the efficient score. They discuss a general trade-off in estimator inefficiency between bias correction and moment approximation.

A simple econometric model of investment in schooling is developed and estimated. The measure of individual discount rates implicit in their educational investment decisions suggests no difference between individuals from different socioeconomic backgrounds. Differences in individual speeds of educational attainment, which do vary with background, explain most of the variation in levels of attainment that is attributable to family background.

This paper considers the effects for offering a “would-not-vote” option in contingent valuation (CV) questions framed using the referendum format. This approach arises from a suggestion made by the National Oceanic and Atmospheric Administration's (NOAA) panel on contingent valuation. The NOAA panel was asked to evaluate the use of this method for estimating the economic value of nonmarketed environmental resources in the context of natural resource damage assessments. This test used the CV questionnaire developed for the study of the Exxon Valdez oil spill conducted by the State of Alaska with in-person interviews. The findings suggest that when those selecting the “would-not-vote” response are treated as having voted “against” the program (a conservative coding), offering this option does not alter (1) the distribution of “for” and “against” responses (2) the estimates of willingness to pay derived from these choices, or (3) the construct validity of the results.

This paper considers the effects for offering a “would-not-vote” option in contingent valuation (CV) questions framed using the referendum format. This approach arises from a suggestion made by the National Oceanic and Atmospheric Administration's (NOAA) panel on contingent valuation. The NOAA panel was asked to evaluate the use of this method for estimating the economic value of nonmarketed environmental resources in the context of natural resource damage assessments. This test used the CV questionnaire developed for the study of the Exxon Valdez oil spill conducted by the State of Alaska with in-person interviews. The findings suggest that when those selecting the “would-not-vote” response are treated as having voted “against” the program (a conservative coding), offering this option does not alter (1) the distribution of “for” and “against” responses (2) the estimates of willingness to pay derived from these choices, or (3) the construct validity of the results.