[R-sig-Geo] spatially correlated heterosckedasticity and spatial econometric models

[Sam Field]

List,

It seems like a sensible model for ecological level influences would be 
a multi-level model in which the level two equation incorporates some 
kind of spatial influence.  For example, if Y[i,j] is an outcome for the 
ith individual nested within  jth second level observation (e.g. census 
tract), then (sorry for the awkward notation). 

Y[i,j] = b[0,j] + b1*X1[i,j] + b2*X2[i,j] + ...+ bp*Xp[i,j] + e[i,j]

where

b[0,j] = (I- rho*W)^-1(g00 + g1*Z[j] + g2*Z2[j] + ...+ gq*Zq[i,j] + u[j])

The second equation is basically the spatial lag model in the reduced form.


I have seen examples where the parameters of this model are estimated in 
two stages.   This probably works




-- 
Samuel H. Field
Division of Internal Medicine - University of Pennsylvania
CHERP - Philadelphia VA Medical Center
3900 Woodland Ave (9 East)
Philadelphia, PA 19104
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