An Extension of the J-test to a Spatial Panel Data Framework
Kelejian (Letters in Spatial and Resources Sciences; 1: 3–11) extended the J-test procedure to a spatial framework. Although his suggested test was computationally simple and intuitive, it did not use the available information in an efficient manner. Kelejian and Piras (Regional Science and Urban Economics; 41: 281–292) generalized and modified Kelejian's test to account for all the available information. However, neither Kelejian 2008 nor Kelejian & Piras 2011 considered a panel data framework. In this paper we generalize these earlier works to a panel data framework with fixed effects and additional endogenous variables. We give theoretical as well as Monte Carlo results relating to our suggested tests. An empirical application on a crime model for North Carolina is also estimated.