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The letter notes that a generalized RESET test can be employed as a test for misspecification in a variety of parametric and semi-parametric micro-econometric models. The test's performance is illustrated using three models commonly used in labour supply studies: the linear, censored (Tobit), and duration (Weibull) regression models. All are estimated by fully parametric (maximum likelihood) and semiparametric methods. Comments are provided on the finite sample performance of the test.
Simon Peters (Thu,) studied this question.
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