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Linear Regression – General Linear Tests

Linear Regression – General Linear Tests. Cobb-Douglas Production Function (Multiplicative Form) Source: C.W. Cobb and P.H. Douglas (1928). “A Theory of Production”, American Economic Review Vol. 18 (Supplement) pp. 139-165. Linear Regression Model with Constraints.

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Linear Regression – General Linear Tests

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  1. Linear Regression – General Linear Tests Cobb-Douglas Production Function (Multiplicative Form) Source: C.W. Cobb and P.H. Douglas (1928). “A Theory of Production”, American Economic Review Vol. 18 (Supplement) pp. 139-165.

  2. Linear Regression Model with Constraints

  3. Solving for Constrained Regression Coefficients

  4. Error Sum of Squares for Constrained Model

  5. Application to (Multiplicative) Cobb-Douglas Production Function • Annual Data 1899-1922 (Indexed to 1899) • Dependent Variable: Q ≡ Quantity Produced • Independent Variables: K ≡ Capital L ≡ Labor

  6. Data, Hypothesis, and OLS Estimator

  7. Constrained Estimator and F-test

  8. t-test/Confidence Interval (k=1 Hypothesis)

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