[vc_row][vc_column][vc_column_text]Multicollinearity is the high correlation of two independent variabels with each other. The VIF test can be used to see of the correlation is too high or not. As if it is high then the regression results will be imprecise. [/vc_column_text][/vc_column][/vc_row]
Chapter 3 – Regression Diagnostics in Gretl – Multicollinearity test Read More »
[vc_row][vc_column][vc_column_text]ADF and KPSS test can be used for time series variables in order to check their order of integration and stationarity so that appropriate model can be applied instead of OLS.[/vc_column_text][/vc_column][/vc_row]
Chapter 5 – Time Series domain – using ADF / KPSS unit root test in Gretl Read More »
[vc_row][vc_column][vc_column_text]ECM method or Engle Granger method is first in the list of time series models which can be used on non stationary variables and it can also be used as causality test. [/vc_column_text][/vc_column][/vc_row]
Chapter 5 – Time series domain – Engle Granger Cointegration method in Gretl Read More »