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Estimating bayesian decision problems with heterogeneous expertise
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Hansen, Stephen, McMahon, Michael F. and Srisuma, Sorawoot (2016) Estimating bayesian decision problems with heterogeneous expertise. Journal of Applied Econometrics, 31 (4). pp. 762-771. doi:10.1002/jae.2446 ISSN 0883-7252.
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Official URL: http://dx.doi.org/10.1002/jae.2446
Abstract
We consider the recent novel two-step estimator of Iaryczower and Shum (American Economic Review 2012; 102: 202–237), who analyze voting decisions of US Supreme Court justices. Motivated by the underlying theoretical voting model, we suggest that where the data under consideration display variation in the common prior, estimates of the structural parameters based on their methodology should generally benefit from including interaction terms between individual and time covariates in the first stage whenever there is individual heterogeneity in expertise. We show numerically, via simulation and re-estimation of the US Supreme Court data, that the first-order interaction effects that appear in the theoretical model can have an important empirical implication. Copyright © 2015 John Wiley & Sons, Ltd.
Item Type: | Journal Article | ||||||||
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Subjects: | H Social Sciences > HB Economic Theory Q Science > QA Mathematics |
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Divisions: | Faculty of Social Sciences > Economics | ||||||||
Library of Congress Subject Headings (LCSH): | Bayesian statistical decision theory, United States. Supreme Court | ||||||||
Journal or Publication Title: | Journal of Applied Econometrics | ||||||||
Publisher: | Wiley-Blackwell Publishing, Inc | ||||||||
ISSN: | 0883-7252 | ||||||||
Official Date: | June 2016 | ||||||||
Dates: |
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Volume: | 31 | ||||||||
Number: | 4 | ||||||||
Page Range: | pp. 762-771 | ||||||||
DOI: | 10.1002/jae.2446 | ||||||||
Status: | Peer Reviewed | ||||||||
Publication Status: | Published | ||||||||
Access rights to Published version: | Restricted or Subscription Access | ||||||||
Date of first compliant deposit: | 31 January 2017 | ||||||||
Date of first compliant Open Access: | 18 March 2017 |
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