EAKIN MARK E wrote:
>
>
> Besides independent normal errors with mean zero and constant
> variance, some (many?) econometric text books do make the assumption that
> the independent variables are uncorrelated. For example see
>
> Gujarti, Damodar (1988), _Basic Econometrics 2nd edition_, McGraw Hill, p.
> 166
>
A student just asked me about this and having seen the thread
I suggested we read it. What I haven't seen (perhaps I read too
fast) is a comment that much of the potential for confusion
arises from the fact that even when statistical terminology
is used rigorously, "independent variables" are not necessarily
(I would say almost never) "independent"!
BTW, let's not forget the piece of the pie that is "confounded"!
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