Questions tagged [omitted-variable-bias]

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3 votes
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Does confounding always imply endogeneity?

I'm a bit confused with the definitions regarding causal inference. My question is whether we can call measured confounding an endogeneity problem?
Anita 's user avatar
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10 votes
2 answers

Omitted variable bias vs. Multicollinearity

There's seems to be a bit like catch 22: suppose I am doing linear regression, and I have 2 variables that are highly correlated. If I use both in my model, I will suffer from multicollinearity, but ...
Maverick Meerkat's user avatar
5 votes
1 answer

How is the omitted variable bias formula derived?

I see it is often quoted that the omitted variable bias formula is $$ \text{Bias}\left(\widehat{\beta_1}\right) = \beta_2 \cdot \text{Corr}\left(X_2,X_1\right) $$ where $\widehat{\beta_1}$ is the ...
user321627's user avatar
  • 3,402
4 votes
2 answers

Using a DAG to understand omitted variable bias in OLS vs Binary Dependent Variable Regression

Suppose I have three variables. $A$ and $U$ are continuous variables but $U$ is unobserved. $Y$ is the binary outcome. $A$ and $U$ are independent. Let the true model be from the typical probit or ...
Pburg's user avatar
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