Maximum Likelihood and Economic Modeling without Apology
(English)In: IZA World of Labor, ISSN ISSN: 2054-9571Article in journal (Refereed) Accepted
The data available to economists is rarely the outcome of natural or quasi experiments. Inaddition, it is common for distinct individuals to exhibit similar responses in a given environment whileobservationally identical individuals will respond differently to similar incentives. In such situations the useof an economic model fitted using maximum likelihood methods provide a general approach to thedescription of the observed data whatever its nature. The predictions obtained from a fitted model providecrucial information about the distributional consequences of economic policies.
Log-Likelihood; Economic Model; Parameter Estimates; Distribution
IdentifiersURN: urn:nbn:se:umu:diva-125870OAI: oai:DiVA.org:umu-125870DiVA: diva2:972474