Econometric Modeling — Extensions

Abstract

The previous chapter identified various sources of misspecffication. This chapter introduces alternative count data models that overcome the restrictiveness of the Poisson specification. Most of these models can be classified depending on the particular problem they address as models for unobserved heterogeneity or as models for selectivity. Unobserved heterogeneity reflects a lack of observability of independent variables, whereas selectivity reflects limits in the observability of the dependent variable. Hybrid models exist as well. A third category of models addresses endogeneity of the regressors.