Nonlinearity and Limited Dependent Variables
Invo tells the class that he is estimating a model of investment in plots of land scattered throughout the suburban areas of the city. He is wondering whether we could learn more about the interaction of a dummy variable, such as a certain neighborhood containing a lot, with a continuous variable, such as the land size. Prof. Metric says that this represents a nonlinear relation that will be discussed in this chapter, and once we finish with it, we will be able to:
1. Analyze cases when slope dummy variables interact with other dummy variables.
2. Discuss other nonlinear models limited dependent variables in regressions.
3. Explain how to apply the linear regression techniques into nonlinear ...
Get Econometrics for Daily Lives, Volume II now with the O’Reilly learning platform.
O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.
