## Info

'Optional

APPENDIX C: THE MATRIX APPROACH TO LINEAR REGRESSION MODEL 955

where R = is a known matrix of order qxk (q < k) and r is a known vector of q elements. To illustrate, suppose our model is

Yi = 01 + 02 X2i + 03 X3i + 04 X4i + 05 X5i + û (3)

and suppose we want to estimate this model subject to these restrictions:

We can use some of the techniques discussed in Chapter 8 to incorporate these restrictions (e.g., 02 = 03 and 04 = 1 — 05, thus removing 02 and 04 from the model) and test for the validity of these restrictions by the F test discussed there. But a more direct way of estimating (3) incorporating the restrictions (4) directly in the estimating procedure is first to express the restrictions in the form of Eq. (2), which in the present case becomes

Was this article helpful?

Learning About The Rules Of The Rich And Wealthy Can Have Amazing Benefits For Your Life And Success. Discover the hidden rules and beat the rich at their own game. The general population has a love / hate kinship with riches. They resent those who have it, but spend their total lives attempting to get it for themselves. The reason an immense majority of individuals never accumulate a substantial savings is because they don't comprehend the nature of money or how it works.

Get My Free Ebook

## Post a comment