Social and Behavioral Sciences Commons^™

Additive Nonparametric Regression In The Presence Of Endogenous Regressors, Deniz Ozabaci, Daniel J. Henderson, Liangjun Su

Research Collection School Of Economics

In this article we consider nonparametric estimation of a structural equation model under full additivity constraint. We propose estimators for both the conditional mean and gradient which are consistent, asymptotically normal, oracle efficient, and free from the curse of dimensionality. Monte Carlo simulations support the asymptotic developments. We employ a partially linear extension of our model to study the relationship between child care and cognitive outcomes. Some of our (average) results are consistent with the literature (e.g., negative returns to child care when mothers have higher levels of education). However, as our estimators allow for heterogeneity both across and within …