S4E03 Two-Stage Least Squares Strikes Back
Quantitude
00:00
What Is a 'Spinning Hook Kick'?
Don't underestimate least squares because it turns out least squares has a spinning hook kick. Gauss Markov gives us the Calvin ball rules that we have to meet in order for least squares to be the best linear unbiased estimator. We typically are going to assume continuity of the dependent variable in old school ordinarily squares. And one that I don't know about you all out there who have taught this, I routinely sweep under the rug and pretend does not exist. The covariance between the predictor and the disturbance is called R sub i.
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