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Lecture Slides: Powerpoint PDF
- Articulate in words the implications of a nonrepresentative sample
- Explain using mathematics the implications of a nonrepresentative sample
- Apply a model of sample selection to correct sample selection bias
- Describe the experiment you would like to run if you could
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What We Learned
Nonrepresentative samples cause estimates of population coefficients to be biased if you sample from a subpopulation that has nonzero correlation between the X variable and errors.
Examples include sampling on outcomes of the Y variable and (sometimes) selection on X variables not in the model.
If you can build a model of selection into the sample, you may be able to correct for selection bias.
Experiments can solve the sample selection problem in theory. Imagining the perfect experiment can help you design a defensible econometric modeling strategy.