Testing Impact Measures in Spatial Autoregressive Models

Giuseppe Arbia*, Anil K. Bera, Osman Doğan, Süleyman Taşpınar

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

11 Citations (Scopus)

Abstract

Researchers often make use of linear regression models in order to assess the impact of policies on target outcomes. In a correctly specified linear regression model, the marginal impact is simply measured by the linear regression coefficient. However, when dealing with both synchronic and diachronic spatial data, the interpretation of the parameters is more complex because the effects of policies extend to the neighboring locations. Summary measures have been suggested in the literature for the cross-sectional spatial linear regression models and spatial panel data models. In this article, we compare three procedures for testing the significance of impact measures in the spatial linear regression models. These procedures include (i) the estimating equation approach, (ii) the classical delta method, and (iii) the simulation method. In a Monte Carlo study, we compare the finite sample properties of these procedures.

Original languageEnglish
Pages (from-to)40-75
Number of pages36
JournalInternational Regional Science Review
Volume43
Issue number1-2
DOIs
Publication statusPublished - 1 Jan 2020
Externally publishedYes

Bibliographical note

Publisher Copyright:
© The Author(s) 2019.

Keywords

  • asymptotic approximation
  • direct effects
  • impact measures
  • indirect effects
  • inference
  • MLE
  • spatial autoregressive models
  • spatial econometric models
  • standard errors
  • total effects

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