Volume 33, Number 1 (Winter) 1998: Symposium on Microeconomic Methods

Blundell, Richard, and Alan Duncan. 1998. "Kernel Regression in Empirical Microeconomics." Journal of Human Resources 33(1):62-87.

We consider the implementation of Kernel methods in empirical microeconomics with specific application to Engel curve estimation in the analysis of consumer behavior. A set of recently developed tests for the parametric null hypothesis against a nonparametric alternative are discussed and implemented for the Angel curve application. We also consider semi-parametric estimation in partially linear models and the case of endogenous regressors. Gauss-based software is available for each technique implemented in the paper.

Richard Blundell is a professor of economics at University College London and the Institute for Fiscal Studies and a coeditor of the Journal of Human Resources. Alan Duncan is a lecturer in economics at the University of York and the Institute for Fiscal Studies. The authors are grateful to James Banks, Hidehiko Ichimura, Gauthuer Lanot, Arthur Lewbel, Joris Pinske and two anonymous referees for helpful comments The f nancial support of the ESRC Centre for the Micro-Economics Analysis of Fiscal Policy at IFS is gratefully acknowledged. Household data from the FES made available by the CSO through the ESRC Data Archive has been used by permission of the HMSO. Neither the CSO nor the ESRC Data Archive bear responsibility for the analysis or the interpretation of the data reported here. The usual disclaimer applies.