Term

Definition
Observations with different . You are less certain how a change in a High variability. determinant will affect the variable. (Rich people in the food expenditure example) 


Term

Definition
Observations with same variances. Low variability.You are more sure of how a change in a determinant will affect the variable. (Poor people in the food expenditure variable) 


Term
How to determine Heteroskedasticity 

Definition
If there are a shit ton variab les far away from the line of regression. The least squares assumption is violated. 


Term

Definition
tests whether random effects estimation would be almost as good. In a fixedeffects kind of case, the Hausman test is a test of H0: that random effects would be consistent and efficient, versus H1: that random effects would be inconsistent. 


Term

Definition
method for estimating the unknown parameters in a linear regression model minimizes the sum of squared vertical distances between the observed responses in the dataset and the responses predicted by the linear approximation 


Term

Definition
Multicollinearity is a statistical phenomenon in which two or more predictor variables in a multiple regression model are highly correlated, 


Term

Definition
the Wald test can be used to test the true value of the parameter based on the sample estimate. suppose smoking multiplies the risk of lung cancer by some number R: then the Wald test can be used to test whether R = 1 (i.e. there is no effect of smoking) or is greater (or less) than 1 (i.e. smoking alters risk). Wald test uses two approximations (that we know the standard error, and that the distribution is chisquared), 


Term

Definition
is a test for a unit root in a time series sample. The more negative it is, the stronger the rejection of the hypothesis that there is a unit root at some level of confidence 


Term

Definition
a loop of causality between the independent and dependent variables of a model leads to endogeneity. 


Term

Definition
error of an observed value is the deviation of the observed value from the (unobservable) true function value 


Term

Definition
residual of an observed value is the difference between the observed value and the estimated function value. 


Term

Definition
test to see if you got rid of endogeniety. 


Term

Definition
Observations with different variances. High variability. determinant will affect the variable greatly.(Rich people in the food expenditure example) 


Term

Definition
Observations with similiar variances. Low variability.You are more sure of how a change in a determinant will affect the variable. (Poor people in the food expenditure variable) 


Term
How to determine Heteroskedasticity 

Definition
If there are a shit ton variables located far from the line of regression. The least squares assumption is violated. 


Term

Definition
Tests whether random effects estimation would be almost as good. In a fixedeffects kind of case, the Hausman test is a test of H0: that random effects would be consistent and efficient, versus H1: that random effects would be inconsistent. 


Term

Definition
A variable is said to be endogenous when there is a correlation between the parameter or variable and the error term. 


Term

Definition
Outline Endogeneity and Instrumental Variables Regression Existence of Endogeneity and Evaluating IV's Panel Data and Fixed Eects What is Endogeneity? What To Do About It? Instruments What is Endogeneity? I Endogeneity can be caused by three circumstances 1. Omitted Variables 2. Measurement Error 3. Simultaneity 


Term

Definition
Observations with different . You are less certain how a change in a High variability. determinant will affect the variable. (Rich people in the food expenditure example) 


Term

Definition
Observations with same variances. Low variability.You are more sure of how a change in a determinant will affect the variable. (Poor people in the food expenditure variable) 


Term
How to determine Heteroskedasticity 

Definition
If there are a shit ton variab les far away from the line of regression. The least squares assumption is violated. 


Term

Definition
tests whether random effects estimation would be almost as good. In a fixedeffects kind of case, the Hausman test is a test of H0: that random effects would be consistent and efficient, versus H1: that random effects would be inconsistent. 


Term

Definition
A variable is said to be endogenous when there is a correlation between the parameter or variable and the error term. 


Term

Definition
used to determine causal relationships 


Term

Definition
Observed differentiating from (Unobserved)expected value. (does not equal 0 indicating independence) 


Term

Definition
The difference between the height of each man in the sample and the observable sample mean is a residual 


Term

Definition
rejecting a null hypothesis that is infact true 

