August 15, 2012

The identification of reporting accuracies from mirror data

Mirror data are observations of bilateral variables such as trade from one country to another, reported by both countries. The efficient estimation of a bilateral variable from its mirror data, for example when compiling consistent international trade statistics, requires information about the accuracy of the reporters.

This paper discusses the simultaneous estimation of the accuracy of multiple reporters, from all mirror data. This requires a model with an identification restriction. Two models are presented, each with the same simple kind of identifying restriction. The inadequate treatment of this restriction in the literature might be an explanation for the limited presence of integrated international statistics.

Published in the Journal of Economics and Statistics, vol 234/1.