National open university of nigeria introduction to econometrics II eco 356

INTRODUCTION TO ECONOMETRICS II

ECO 306

NOUN
53


UNIT 2: PROPERTIES OF THE REGRESSION COEFFICIENTS AND
HYPOTHESIS TESTING
CONTENTS
2.2.1.0 Introduction
2.2.2.0 Objectives
2.2.3.0 Main Content
2.2.3.1 The Random Components of the Regression Coefficients
2.2.3.2 Assumptions Concerning the Disturbance Term
2.2.3.2.1 Gauss–Markov Condition 1: E(μ
i
) = 0 for All Observations
2.2.3.2.2 Gauss–Markov Condition 2: Population Variance of μ
i
Constant for All Observations
2.2.3.2.3 Gauss–Markov Condition 3: μ
i
Distributed Independently of μ
j
( )
2.2.3.2.4 Gauss–Markov Condition 4: u Distributed Independently of the Explanatory Variables
2.2.3.3 The Normality Assumption
2.2.3.4 Unbiasedness of the Regression Coefficients
2.2.3.5 Precision of the Regression Coefficients
2.2.3.6 Testing Hypotheses Relating to the Regression Coefficients
2.2.3.6.1 Formulation of a Null Hypothesis
2.2.3.6.2 Developing the Implications of a Hypothesis
2.2.3.7 Compatibility, Freakiness, and the Significance Level
2.2.3.8 What Happens if the Standard Deviation of
is Not Known
2.2.4.0 Conclusion
2.2.5.0 Summary
2.2.6.0 Tutor-Marked Assignment
2.2.7.0 References/Further Reading

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