2.6.3.0 MAIN CONTENTS
2.6.3.1 Model Specification
The knowledge of exactly which descriptive variables ought to be included in the equation helps when we undertake regression analysis, our task would equally be limited to calculating estimates of their coefficients, confidence intervals for these estimates and soon. In practice, however, we can never be sure that we have specified the equation properly. Economic theory ought to provide a guide, but thetheory is never flawless. Unaware, we might be including some variables that ought not to be in the model and we might be leaving out others that ought to be incorporated.
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