Jesus christ dude. I cannot describe how lost I was with my econometric homework. You explained literally everything perfectly and clearly, and I had no trouble following along with my own models. Do you have a venmo so I can tip you a 6-pack?
@sebastianWaiEcon thanks very much for this great video. It is extremely helpful. I have looked for a source for the F statistic and P-value calculations in order to reference but I cannot find one that matches this. Have you got a reference please? Secondly, how would this calculation differ if you have two models with exactly the same parameters?
Apologies for missing this. I based this video off Introductory Econometrics by Jeffrey Wooldridge. For an F test, you are always comparing what happens when you remove variables.
Hi, SebastianWaiEcon. I would like to ask you about F statistic. If i ran a regression and the F(... , ...) for my unrestricted model is very high (216.86) and my Prob > F = 0.0000, I've never seen such high numbers from all the youtube tutorials I've watched. Does this indicate something is wrong with my model or is it more of a common occurences than I thought? Thank you in advance.
@@sebastianwaieconOh I see. Indeed, my sample consisted of +-2800 observation, maybe that is what caused the fstat went high. Thank you so much for your reply, SebastianWaiEcon!!!
thank you so much but you did not give us the cut off F-value. You jus mentioned tht 6.25 means that something in our regression is explaining the dep var (salary). My question is what is the cut off value to check if the F-value is too low to explain the dep var
There is no one "cutoff" to be used in all situations. Critical values for the F distribution depend on the degrees of freedom, so will be unique to each test. Further, the actual significance threshold is always going to be subjective. Typically, people look at 90, 95, and 99% significance, but the choice is yours.
This means the p value is so small that it doesn't even show up with 4 decimal places. The p value is not zero -- that is impossible -- it is just a very, very small number.
