... s
2
x
2
2
+···+s
2
x
2
T
(4A .28 )
which can also be written
var(
ˆ
β) =
s
2
x
2
t
2
x
2
1
+ x
2
2
+···+x
2
T
=
s
2
x
2
t
x
2
t
2
(4A .29 )
An overview of regression analysis ... closest
92 Real Estate Modelling and Forecasting
x
y
0
Figure 4.11
Effect on the standard
errors of x
2
t
large
x
y
0
Figure 4. 12
Effect on the standard...
... E
u
t
g
t
2
=
g
2
t
E
u
2
t
= s
2
g
2
t
(4A.34)
Writing (4A.34) out in full for g
2
t
and expanding the brackets,
var( ¯α) =
s
2
T
x
2
t
2
− 2
x
t
x
2
t
x
t
+
x
2
t
x
t
2
T
x
2
t
−
x
t
2
2
(4A.35)
This ... section
5.9 – i.e. the true DGP is represented by
y
t
= β
1
+ β
2
x
2t
+ β
3
x
3t
+ β
4
x
4t
+...