Dear list users,

To begin, I apologise for any naivety displayed in this post! I'm still trying 
to come to terms with some of the ideas in spatial regression. I hope someone 
can provide me with some guidance on a problem I have.

I am analysing data on individuals nested within zones so automatically used 
multilevel modelling to reflect this hierarchy. I have both individual level 
and zone level variables to use to determine an individual level response. All 
zones are found within a city and some of the zones for which I have individual 
level information are neighbours. I have a matrix of 0s and 1s to reflect this 
information so I was wondering if it possible to fit some sort of spatial 
multilevel model to this data in R? I am not sure that this is necessary as it 
does not appear that the random slope effect for zones is significant in the 
model. However, I retained this effect as some of the zone level variables are 
statistically significantly associated with the response.

Is there some sort of a test to assess whether or not there is residual spatial 
autocorrelation which has not been taken into account by my multilevel model? I 
tried extracting the zone level residual information and using a moran test. 
However, I have a feeling that this may not be the correct approach to take. 
Anyone have any suggestions?

Cheers,
Karen
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