The Empirical Trap of Sign Reversals with Equality Restrictions
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Date
2005-01-15
Authors
Haynes, Stephen E., 1945-
Journal Title
Journal ISSN
Volume Title
Publisher
University of Oregon, Dept of Economics
Abstract
This note explores the insidious empirical trap posed by two common equality restrictions in regression analysis. The trap is that restricted coefficients can lie outside the interval of unrestricted coefficients and even reverse sign when negatively correlated regressors are added to one another or when positively correlated regressors are subtracted from one another.
Description
11 p.
Keywords
Equality restrictions, Sign reversals, Invalid restrictions