Regression modelEconometrics / time series

Arellano-Bond GMM Estimator

The Arellano-Bond GMM estimator is the standard approach for dynamic panel data models in which the lagged dependent variable appears as a regressor. By first-differencing to remove fixed effects and using deeper lags as instruments, it yields consistent estimates even when the error is serially correlated and regressors are endogenous.

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Sources

  1. Arellano, M., & Bond, S. (1991). Some tests of specification for panel data: Monte Carlo evidence and an application to employment equations. Review of Economic Studies, 58(2), 277-297. DOI: 10.2307/2297968
  2. Roodman, D. (2009). How to do xtabond2: An introduction to difference and system GMM in Stata. Stata Journal, 9(1), 86-136. DOI: 10.1177/1536867X0900900106

Related methods

Referenced by

ScholarGateArellano-Bond GMM estimator (Arellano-Bond Generalized Method of Moments Estimator). Retrieved 2026-06-04 from https://scholargate.app/tr/econometrics/arellano-bond-gmm-estimator