Restricted least squares (RLS). If the dependent variables in the restricted and unrestricted regressions are not the

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Restricted least squares (RLS). If the dependent variables in the restricted and unrestricted regressions are not the same, you can use the following variant of the F test given in Eq. (4.56)
Restricted least squares (RLS). If the dependent variables in the

where RSSr = residual sum of squares from the restricted regression, RSSur = residual sum of squares from the unrestricted regression, m = number of restrictions, and (n - k) = d.f. in the unrestricted regression.
Just to familiarize yourself with this formula, rework the model given in Table 4-4.

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Essentials of Econometrics

ISBN: 978-0073375847

4th edition

Authors: Damodar Gujarati, Dawn Porter

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