Instead of regressing LDIVIDENDS on LCP in level form, suppose you regress the first difference of LDIVIDENDS

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Instead of regressing LDIVIDENDS on LCP in level form, suppose you regress the first difference of LDIVIDENDS on the first difference of LCP. Would you include the intercept in this regression? Why or why not? Show the calculations.

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Basic Econometrics

ISBN: 978-0073375779

5th edition

Authors: Damodar N. Gujrati, Dawn C. Porter

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Question Posted: May 29, 2018 04:07 AM

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Instead of regressing LDIVIDENDS on LCP in level form, suppose you regress the first difference of LDIVIDENDS

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In theory there should not be an intercept in the model But if there was a trend term in the origina...View the full answer

Basic Econometrics

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