The IV Regression Assumptions Include All of the Following with the Exception

question 37

Short Answer

The IV regression assumptions include all of the following with the exception of a. the error terms must be normally distributed.
b. $E \left( u _ { i } \mid W _ { 1 i } , \ldots , W _ { r i } \right) = 0$ .
c. Large outliers are unlikely: the $X$ 's, $W$ 's, $Z$ 's, and $Y$ 's all have nonzero, finite fourth moments.
d. $\left( X _ { 1 i } , \ldots , X _ { k i } , W _ { 1 i } , \ldots , W _ { r i } , Z _ { 1 i } , \ldots Z _ { m i } , Y _ { i } \right)$ are i.i.d. draws from their joint distribution.

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Definitions:

Criterion Variable

Another term for the dependent variable, it's the outcome variable that researchers are interested in predicting or explaining.

Regression

A statistical method to model the relationship between a dependent variable and one or more independent variables, predicting the value of the dependent variable based on the independents.

Predict

To make an informed guess about the future state or outcome based on current data or patterns.

Regression Equation

An equation that represents the relationship between a dependent variable and one or more independent variables.