Which of the Following Is a Justification for Overidentification Tests

question 3

Multiple Choice

Which of the following is a justification for overidentification tests?

• A) If each instrument satisfies both the inclusion and exclusion condition, than using each instrument alone should produce an unbiased estimate of B1.
• B) If each instrument satisfies both the inclusion and exclusion condition, than using each instrument alone will produce biased results.
• C) Once we identify the excessive identification condition, the efficiency of our estimates will improve.
• D) They allow us to identify weak instruments.

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