Estimation | Test and hypotheses | Results | ||
---|---|---|---|---|
Test for multi- collinearity | Variance inflation factor (VIF) | Variable | VIF | 1/VIF |
LGDPCA | 8.15 | 0.0985 | ||
LFVA | 5.16 | 0.1937 | ||
LQS | 3.80 | 0.2635 | ||
QI | 2.67 | 0.3748 | ||
LHCA | 2.28 | 0.4395 | ||
LFDI | 2.13 | 0.4694 | ||
LDOC | 1.87 | 0.5339 | ||
Mean VIF | 4.01 | |||
Breusch-Pagan Lagrange multiplier (LM) | xttest0 command in STATA 12. H0=Null Hypothesis: No panel effect. | Chibar2 (01) = 674.24 Prob > F= 0.000 | ||
Hausman Test: selection between fixed or random effects | xtreg + Hausman commands in STATA 12. H0: Random effect model is appropriate H1: Fixed effect model is appropriate | P.value>\(\mathop x\nolimits^{2}\)=0.000 | P.value>\(\mathop x\nolimits^{2}\)=> 0.05, therefore fixed effect is appropriate. | |
Tests for serial correlation | Wooldridge Test H0: no first order autocorrelation | F (1, 4) = 0.860 | Prob > F = 0.4061 | |
Test for heteroskedasticity | Modified Wald Test H0: Sigma(i)2=sigma2 for all i | \(\mathop x\nolimits^{2}\)(5) = 102.12 | Prob= 0.0000 |