Research Highlight

Estimation of Dynamic Panel Threshold Model using Stata

  • Journal The Stata Journal: Promoting communications on statistics and Stata / Volume: 19 issue: 3, page(s): 685-697
  • Author Myung Hwan Seo, Sueyoul Kim, Young-Joo Kim
  • Link https://doi.org/10.1177%2F1536867X19874243
In this article, we develop a command, xthenreg, that implements the first-differenced generalized method of moments estimation of the dynamic panel threshold model that Seo and Shin (2016, Journal of Econometrics 195: 169–186) proposed. Furthermore, we derive the asymptotic variance formula for a kink-constrained generalized method of moments estimator of the dynamic threshold model and provide an estimation algorithm. We also propose a fast bootstrap algorithm to implement the bootstrap for the linearity test. We illustrate the use of xthenreg through a Monte Carlo simulation and an economic application
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