Cochorane-Orcutt procedure

[cuongnh]

Could you please explain me more in details how to use AR(1) procedure?

[cuongnh]

Dear Startz, I used C-O procedure, and the best estimation was right at the second time. I mean SSR, rho are smallest compared with that in other steps. I think that is the best estimation for my data. However, the Durbin Watson is still low, it is 1.17, and Adj. R Squared is just around .55. I am worried about that. But some poeple just said low R^2 in C-O procedure is acceptable. Do you have any ideas regarding this result?
I fact, I used one trend variable on the right side of the model. In details, I added a variable with value of 1 (1,1,1,1,1,1) for first half of the observations, the remainings take value from 1, 2, 3,4.... till the end. Then I squared those values, results from squaring were used as a dummy variable in my specification. I read from a certain book that, C-O procedure should not be applied to the model with trend variable. Could you please let me know if my model with that trend variable is right or wrong, should it be included in the model if I use C-O procedure?
Thank you very much for your helps!

Please help me explain above ideas. I need them asap. Thank you very much!