Suppose we reckon that some variable of interest, y, is ‘driven by’ some other variable x. We then call y the
dependent variable and x the independent variable. In addition, suppose that the relationship between y and x is
basically linear, but is inexact: besides its determination by x, y has a random component, u, which we call the
‘disturbance’ or ‘erro
Suppose we reckon that some variable of interest, y, is ‘driven by’ some other variable x. We then call y thedependent variable and x the independent variable. In addition, suppose that the relationship between y and x isbasically linear, but is inexact: besides its determination by x, y has a random component, u, which we call the‘disturbance’ or ‘erro
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