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I have an instrument and an endogenous variable that correlated at a level of 0.42. This seems to me to be sufficiently strong, but whenever I perform any Wald statistics or weak instrument tests, the results show that there is a weak instrument with very low F scores. How can this be?

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  • $\begingroup$ .42 is not exactly what's generally understood as highly correlated. $\endgroup$ – Diego Mar 27 '16 at 14:44

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