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In econometrics, extreme bounds analysis is a type of sensitivity analysis which attempts to determine the most extreme possible estimates for a fixed subset of allowed coefficients and a variable set of linear homogeneous restrictions. [1] It was originally developed by Edward E. Leamer in 1983, and subsequently refined by Clive Granger and Harald Uhlig in 1990. [2] It is a more precise method of measuring specification uncertainty than traditional econometrics because it incorporates prior information, and uses a systematic methodology to examine the fragility of coefficients. [3] It allows researchers to obtain upper and lower limits for the parameter of interest for any possible set of explanatory variables. [4]
This article is an
orphan, as no other articles
link to it. Please
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related articles; try the
Find link tool for suggestions. (June 2024) |
In econometrics, extreme bounds analysis is a type of sensitivity analysis which attempts to determine the most extreme possible estimates for a fixed subset of allowed coefficients and a variable set of linear homogeneous restrictions. [1] It was originally developed by Edward E. Leamer in 1983, and subsequently refined by Clive Granger and Harald Uhlig in 1990. [2] It is a more precise method of measuring specification uncertainty than traditional econometrics because it incorporates prior information, and uses a systematic methodology to examine the fragility of coefficients. [3] It allows researchers to obtain upper and lower limits for the parameter of interest for any possible set of explanatory variables. [4]