Hi everyone,
I have recently meet some problems in measurement error. As I learned in econometrics that the measurement error in dependent variable could underestimate the results, and the measurement error in independent variable could instead result in endogenous problem.
However, I recently read many papers, and list one for example, wrote by Gao, P., & Lei, Y. H. (2021) who argues that the measurement error they created in independent variable might attenuate the estimates. The fact that they still find significant results under such bias against our estimates further supports their results (page 77).
This seems disagrees with my previous knowledge, and could anyone help to explain? Thanks in advance!
Reference:
Gao, P., & Lei, Y. H. (2021). Communication infrastructure and stabilizing food prices: evidence from the telegraph network in China. American Economic Journal: Applied Economics
I have recently meet some problems in measurement error. As I learned in econometrics that the measurement error in dependent variable could underestimate the results, and the measurement error in independent variable could instead result in endogenous problem.
However, I recently read many papers, and list one for example, wrote by Gao, P., & Lei, Y. H. (2021) who argues that the measurement error they created in independent variable might attenuate the estimates. The fact that they still find significant results under such bias against our estimates further supports their results (page 77).
This seems disagrees with my previous knowledge, and could anyone help to explain? Thanks in advance!
Reference:
Gao, P., & Lei, Y. H. (2021). Communication infrastructure and stabilizing food prices: evidence from the telegraph network in China. American Economic Journal: Applied Economics
