In an IV regression model with one regressor, (X_{i}), and one instrument, (Z_{i}), the regression of (X_{i})
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In an IV regression model with one regressor, \(X_{i}\), and one instrument, \(Z_{i}\), the regression of \(X_{i}\) onto \(Z_{i}\) has \(R^{2}=0.05\) and \(n=100\). Is \(Z_{i}\) a strong instrument? See Equation (7.14). Would your answer change if \(R^{2}=0.05\) and \(n=500\)?
Equation (7.14)
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