Model Specification

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August 31, 2024 4 min read Definitions

Economics Statistics Hausman Test Model Specification Econometrics Random Effects Fixed Effects

The Hausman Test is a model specification test commonly used in econometrics to evaluate the consistency and efficiency of two proposed estimators under different hypotheses.

August 31, 2024 4 min read Definitions

Ramsey Regression Equation Specification Error Test: Evaluating Linear Regression Model Specifications

Economics Statistics Ramsey RESET Linear Regression Model Specification Econometrics Statistical Testing

The Ramsey Regression Equation Specification Error Test (RESET) is a diagnostic tool used in econometrics to detect misspecifications in a linear regression model by incorporating non-linear combinations of explanatory variables.