In this lecture we introduce the idea of instrumental variables regression that helps researchers to estimate causal effects when OLS assumptions fail 00:00 Introduction 01:12 Threats to internal validity 09:25 Simultaneous causality 19:55 Instrumental variables 28:18 Two stage least squares estimator 37:20 Derivation of TSLS estimator 40:22 Consistency of TSLS estimator 43:22 Empirical examples 1:01:13 Conclusion The course “Econometrics II“ for the 3rd year bachelors in Economics Taught at BRICS institute, Irkutsk National Research Technical University, Winter semester 2022
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