We have covered the following topics since the last midterm:

*Serial Correlation (continued)*

1. Tests for serial correlation

a. The Durbin-Watson test.

b. Durbin's h-test.

c. The Breusch-Godfrey test for higher order serial correlation.2. The CORC procedure

3. Corrections for higher-order serial correlation and search procedures

a. Estimating a model with higher order serial correlation using a generalized CORC procedure.

b. Hildreth-Lu search procedure.

*Stochastic Regressors and Measurement Errors*

3. Assessing the bias and consistency of an estimator

4. Errors in variables

a. Consequences of estimating with OLS (differences in mismeasurement. of the dependent variable and the independent variables).

b. Application of errors in variables: Friedman's Permanent Income Hypothesis.5. Instrumental variable estimation

a. What is an instrument.

b. How is IV performed?

c. Show how IV estimation can solve the problem of correlation of the right-hand side variables with the error term.

*Simultaneous equation models*

6. Structural equations (behavioral, identities, equilibrium conditions, technical equations) and reduced form equations. Endogenous, exogenous, and predetermined variables

7. Consequences of ignoring simultaneity, i.e. demonstrate simultaneity bias

8. Underidentified models, exactly identified models, and overidentified models

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