Multiple Linear Regression Model Used in Economic Analyses

The multiple regression is a tool that offers the possibility to analyze the correlations between more than two variables, situation which account for most cases in macro-economic studies. The best known method of estimation for multiple regression is the method of least squares. As in the two-variable regression, we choose the regression function of sample and minimize the sum of squared residual values. Another method that allows us to take into account the number of variables factor when determining the validity of harmonization is given by the Akaike information criterion.