Explain why it is not possible to include an outlier dummy variable in a regression model when

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Explain why it is not possible to include an outlier dummy variable in a regression model when you are conducting a Chow test for parameter stability. Will the same problem arise if you were to conduct a predictive failure test? Why or why not?

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Introductory Econometrics For Finance

ISBN: 9781108436823

4th Edition

Authors: Chris Brooks

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Question Posted: Jul 23, 2024 09:00 AM

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Explain why it is not possible to include an outlier dummy variable in a regression model when

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Introductory Econometrics For Finance

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