The title is a reference to Angrist and Pischke's (2009) “Mostly Harmless Econometrics” which outlines the experimentalist paradigm and argues that fancier econometric techniques are unnecessary and potentially dangerous.
MOSTLY POINTLESS SPATIAL ECONOMETRICS?*
Article first published online: 16 APR 2012
© 2012, Wiley Periodicals, Inc.
Journal of Regional Science
Volume 52, Issue 2, pages 172–191, May 2012
How to Cite
Gibbons, S. and Overman, H. G. (2012), MOSTLY POINTLESS SPATIAL ECONOMETRICS?. Journal of Regional Science, 52: 172–191. doi: 10.1111/j.1467-9787.2012.00760.x
- Issue published online: 19 APR 2012
- Article first published online: 16 APR 2012
- Received: September 2010; revised: October 2011; accepted: October 2011.
ABSTRACT We argue that identification problems bedevil applied spatial economic research. Spatial econometrics usually solves these problems by deriving estimators assuming that functional forms are known and by using model comparison techniques to let the data choose between competing specifications. We argue that in many situations of interest this achieves, at best, only very weak identification. Worse, in many cases, such an approach will be uninformative about the causal economic processes at work, rendering much applied spatial econometric research “pointless,” unless the main aim is description of the data. We advocate an alternative approach based on the “experimentalist paradigm” which puts issues of identification and causality at center stage.