LM Tests for Random Effects

We explore practical methods of carrying out Lagrange Multiplier tests for variance components in two models in which the derivatives needed for the test are identically zero at the restricted estimates, the random effects probit model and the stochastic frontier model. The techniques are illustra...

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Bibliographic Details
Main Authors: Greene, William, McKenzie
Format: Working Paper
Published: NYU Stern School of Business 2012
Subjects:
Online Access:http://web-docs.stern.nyu.edu/old_web/economics/docs/workingpapers/2012/Greene-LMTestsRandomEffects_Sept2012.pdf
http://hdl.handle.net/20.500.11937/42491