Heteroscedasticity (Univariate models)

the data series is sufficiently large... about more than 30 0bservations then you can ignore

the violation of normality assumption coz by central limit theorem a long series will

converge to normality.... for auto-correlation and heteroskedasticity we can try first some

transformation in the variables.... however, if that does not work then use Newey-West

test for HC and HAC... This is readily available in R and Stata... Not sure about Eviews....

hope this helps..

increases, the level of your hedonistic behavior tends to move along .As you are aging

over time, you will always remain the child of your parent whether they are rich or poor .

this is homoscedasticity....

Sheikh Muzammil Naseer commented> Hetroscedasticity is present...

Douma commented > the p value in less than 0.05, i think ther's heteroskedasticity.

Sayed Hossain commented> Null hypothesis: homoscedstic, Alternative hypothesis:

hetrocedasticity. As the p value is almost zero meaning we can reject null. So the

residuals are heteroscedastic.

the model suffering from hetreroscedsaticity?

Muhammad Abid Economistc commented> I think Yes because of that point which is far

away from others known as outlier....

Muhammad Zhafran commented> Yes. There is a systematic pattern between the

residuals and predicted values. Am I right?

Khalid Mahmood Anjum commented> Yes systematic pattern exist in scatter plot so abid

and zhafran replied correctly

Sayed Hossain commented> Heteroscedasticity exists as there is systematic pattern or

specific direction movement in the residuals.

helping.

Ghumro Niaz Hussain commented> do not reject null hypothesis at 5% and it is concluded

that variance of the residuals is homo....

Faridoon Khan Marwat Do not reject ur null hypothesis and turns to be homo

Sayed Hossain commented> We can not reject null meaning that residuals are

homoscedastic, which is desirable.

Muhammad Imran Javed commented> I agree with sir Syed Hossain and Khurshid Gelios

sir here you are doing hypothesis testing of hetero, not developing the relationship

between variables.

Like · Reply · November 26, 2016 at 2:55pm

Sayed Hossain

Saud Ahmad commnted> but we should not accept null if p-value is less than 10% level of

confidence. We can't ignore that. so I would suggest consider it rejection of null. as

usually we consider 1%, 5% and 10% level of significance for decision. Some economist

argue that in social sciences we should consider a var significant even at 12%.

Ade Kutu

Afolabi Luqman

Abdullah Sonnet

Asad Zaman

Atiq Rehman

Burcu Özcan

Ghumro Niaz Hussain

Muhammad Anees

Mohammad Zhafran

Muzammil Bhatti

Monis Syed

Mine PD

Moulana N. Cholovik

Muili Adebayo Hamid

Nicat Gasim

Najid Iqbal

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Noman Arshed

Rapelanoro Nady

Seye Olasehinde-Williams

Suborno Aditya

Sayed Hossain

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Sheikh Muzammil Naseer

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Meo School of Research

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Noman Arshed

Hossain Academy Note

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