The economists used mafia influence as an instrumental variable to help estimate the effect of central funds given to local councils.

The policy change to a more liberalized economy is identified using SEZ variables as instrumental variables.

The estimation of economic relationships using instrumental variables.

Due to the simultaneity between the dependent variable and the current eurobond yield, the equation was estimated by instrumental variables.

Formal definitions of instrumental variables, using counterfactuals and graphical criteria, are given by Pearl (2000).

Notions of causality in econometrics, and their relationship with instrumental variables and other methods, are discussed by Heckman (2008).

When the form of the structural equations is unknown, an instrumental variable can still be defined through the equations:

One widely-used remedy is the method of instrumental variables (IV).

However there are several techniques which make use of some additional data: either the instrumental variables, or repeated observations.

With 29 regressors and only 49 observations, degrees of freedom were limited, prohibiting the initial use of instrumental variables.