Question: What are the two conditions for omitted variable bias?Based on the answer above, are our OLS estimators biased or unbiased? Give short explanations. We are

What are the two conditions for omitted variable bias?Based on the answer above, are our OLS estimators biased or unbiased? Give short explanations.

We are given a sample of n observations that satisfy the following regression model Yi = Bo + BIXli + B2Xzi + B3X3i + Ui, for all i = 1, . .., n. This model fulfills the Least-Squares assumptions. Moreover, we also know that Cov(Xli, Xsi) = Cov(X2i, X3i) = 0. We obtain OLS estimators of {B1, B2, 83} separately from the following regressions Yi = Bol + BIXli + B2Xzi + Uli, (M1 ) Yi =Boz + B3Xsi + Uzi, (M2) where both models satisfy the least-squares assumptions. 1. What are the two conditions for omitted variable bias? image.png 2. Based on your previous answer, are our OLS estimators biased or unbiased? Give a short explanation. Drop files or click here to upload MacBook Pro esc Q O @ # $

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