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Extra info for Econometrics: Legal, Practical and Technical Issues
5. To What Ertent Are the Exptanatory Variables Conelated with Each Other? In muttiple regression analysis the explanatory variable_ of interest must not b; correlated perfectly wittl one or more of the other explanatory variables. A perfect conelation between two variables would not allow an expert to distinguish the effect of one explanatory variable on the dependent variable from the effect of the other explanatory variable. Suppose, for example, that in a monopolization case a particular product quallty is determined to be a valid source of high price and that the plaintiffs failure to offer that product qualrty was not aor to any action of the defendant.
10. (1986). m Post-Bazemore antitrust decisions have treated the omission of variables from econometric regression analyses similarly to Bazemore with respect to admissibilrty, particularly where the proffering party's expert squarely addresses the objecting parly's points. ln Conwood v. s If an econometric expert's selection of variables and underlying assumptions are sound, a regression may be admissible even without explicitly addressing an adversary's objections. r FiFt, the court listed three statistical justifications that the 80.
93 F; Supp. D. Ga. 2000). 43. Id. at 1364. 44. Id. 45. Id. S. Dist. LEXIS 46. 47. 15458, at *18 (finding that 'tegression analysis is universally accepted as one of the principal methods to intelpret the type of financial and economic data at issue in this case," rvhich was testing the impact of different factors on the relevant product's price); Dee-K Enters. v. Hevafil Sdn. , 2001-l Trade Cas. C. 2001) (noting that expert's 'ttse of multiple regression analysis is the prefened technique of economists when ccmducting similar studies'); Allapattah servs.