Introduction to Nonlinear Models

Abstract

The characteristics of the data, which may be strictly positive, qualitative or integer etc., the features of the dynamics, which may exhibit cycles, varying variabilities etc. or the functional forms deduced from economic theory, often lead to the introduction of nonlinear models, both with respect to the parameters and to the explanatory variables. Fixed or random effects, individual, time or cross error terms may also be considered in this nonlinear framework and the appropriate methodologies and results will extend those described in Chapters 2, 3, and 4.