Constructs excluded instruments using the traditional BLP approach:
sums of characteristics of other own-firm products and rival products.
Usage
build_blp_instruments(X, market_ids, firm_ids)
Arguments
- X
Matrix of exogenous product characteristics (N x K)
- market_ids
Market identifiers (length N)
- firm_ids
Firm identifiers (length N)
Value
Matrix of instruments (N x 2K): own-firm and rival columns
Examples
if (FALSE) { # \dontrun{
iv <- build_blp_instruments(X_exog, product_data$market_ids, product_data$firm_ids)
} # }