Prediction in the two-way random effects model.}

(a) For the two-way error component model in (3.1), verify (3.39) and (3.42).

(b) Also, show that if there is a constant in the regression \(\iota_{N T}^{\prime} \Omega^{-1} \widehat{u}_{G L S}=0\), and \(\widehat{\widehat{u}}_{. ., G L S}=0\).

Transcribed Image Text:

Uit = pi + X + Vit i = 1, ..., N t = 1,..., T (3.1)