Sources of Endogeneity Is simultaneity the same as heterogeneity? Are both sources of endogeneity and hence bias? As far as I understand, simultaneity bias arises when both variables are determined from within the model where as heterogeneity bias is differences across observational units which causes the error term to be correlated with the regressor?
 A: Simultaneity is not the same as heterogeneity. For example, classroom teaching is consumed by students in real time, so it is simultaneous, which just means that production and consumption of a tangible or intangible occur at the same time. However, the consumption is also heterogeneous, which for classroom teaching means that the consumption, in this case, the understanding remembering and ability to use that teaching in practice, has variable penetration. Heterogeneity bias in econometrics means that statistical inferences may be erroneous if, in addition to the observed variables under study, there exist other relevant variables that are unobserved, but correlated with the observed variables; dependent and independent variables. For example, if we wish to combine heterogeneous studies using meta-analysis, we will have a heterogeneity bias.
Endogeneity can be from an omitted variable causing bias, measurement error, autoregression with autocorrelated errors, or simultaneous causality. Thus and although there is some overlap in these terms in specific cases, they are not the same things.
