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Table 4 Difference generalized method of moments (GMM) estimation results

From: Growth, inequality and poverty dynamics in Mexico

Left-hand-side variable System of equations comprising (1), (2) and (3) Fixed-effect estimation of Eq. (4)
Difference GMM estimation Fixed-effect est.
Consumption (t) Gini (t) Poverty (t)   Poverty (t)
Specification A: with year effects only
 Consumption (t − 1) 0.4226*** (0.0971) − 0.1097*** (0.0221) − 0.1287*** (0.0356) Consumption (t) − 0.4171*** (0.0157)
 Gini (t − 1) − 1.7569*** (0.2277) 0.1411* (0.0784) 0.2846** (0.1125) Gini (t) 1.0689*** (0.0494)
Wald χ2-test (Chi2(12)) 379.57*** 103.39***    
No. of instruments 67 67    
Arellano–Bond test (Order 2) 0.1642 0.7957    
Sargan test (54) 0.9536 0.8414    
R-squared    0.61   0.89
Specification B: with year effects and controls
 Consumption (t − 1) 0.4818*** (0.1187) − 0.1048*** (0.0260) − 0.1229*** (0.0409) Consumption (t) − 0.4349*** (0.0188)
 Gini (t − 1) − 1.7196*** (0.2335) 0.1326 (0.0839) 0.2815** (0.1058) Gini (t) 1.0610*** (0.0438)
 Education (t − 1) − 0.4117 (0.2881) 0.0140 (0.0846) 0.1221 (0.1285) Education (t) 0.1576*** (0.0370)
 Urban (t − 1) − 0.1266 (0.1230) − 0.0226 (0.0487) 0.1223* (0.0681) Urban (t) 0.1637*** (0.0201)
 Tertiary sector (t − 1) − 0.3273 (0.2193) − 0.0302 (0.0784) − 0.1577 (0.0886)* Tertiary sector (t) 0.0034 (0.0419)
 Aged (t − 1) − 1.1168 (0.7447) 0.0603 (0.2920) 0.3138 (0.2742) Aged (t) − 0.0022 (0.1382)
 Intercept 5.2651*** (0.8470) 1.2681*** (0.1898) 1.0952*** (0.3002) Intercept 3.1240*** (0.1331)
Wald χ2-test (Chi2(16)) 431.21*** 144.99***    
No. of instruments 71 71    
Arellano–Bond test (Order 2) 0.1753 0.8226    
Sargan test (54) 0.7747 0.8315    
R-squared    0.63   0.91
  1. The number of observations is 320 for the difference GMM estimation, 352 for Eq. (3) and 384 for Eq. (4)
  2. Robust standard errors, adjusted for clustering on state, are shown in parentheses
  3. ***, **, and * represent significance at the 1, 5, and 10% level, respectively