Regression - Deriving the Ordinary Least Squares Estimates
3 important questions on Regression - Deriving the Ordinary Least Squares Estimates
How can the ordinary least squares estimates be derived?
(2) Zero conditional mean implies E[u]=0 and cov(x,u)=E[xu]=0
Using u = y - beta 0 - beta 1 * x gets
E[y-beta0-beta1*x]=0 and E[x(y-B0-B1x)]=0
(3) The ordinary least squares (OLS) estimates satisfy the sample equivalent of these two moment conditions
What are the OLS estimates minimising?
What is the formula of the OLS regression line / sample regression function?
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