Difference-based matrix perturbation method for semi-parametric regression with multicollinearity |
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| Authors: | Chien-Chia L Huang Yow-Jen Jou Hsun-Jung Cho |
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| Institution: | 1. Department of Transportation and Logistics Management National Chiao Tung University Hsinchu, Taiwan, Republic of China;2. Department of Information Management and Finance, National Chiao Tung University Hsinchu, Taiwan, Republic of China |
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| Abstract: | This paper addresses the collinearity problems in semi-parametric linear models. Under the difference-based settings, we introduce a new diagnostic, the difference-based variance inflation factor (DVIF), for detecting the presence of multicollinearity in semi-parametric models. The DVIF is then used to device a difference-based matrix perturbation method for solving the problem. The electricities distribution data set is analyzed, and numerical evidences validate the effectiveness of the proposed method. |
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| Keywords: | Biased estimation collinearity diagnostic partial linear models variance inflation factor |
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