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MULTICOLINEARITY

Posted: Thu Aug 28, 2014 5:27 pm
by Lol38
Hello,

Im trying to run a programme but it shows the message "near singular matrix. Regressors may be perfect collinear". I have calculated the level of multicolinearity and it is more than 210.

Is there any way to solve the multicolinearuty problem?

Re: MULTICOLINEARITY

Posted: Thu Aug 28, 2014 5:45 pm
by EViews Gareth
210?

Re: MULTICOLINEARITY

Posted: Thu Aug 28, 2014 6:52 pm
by startz
Near perfect multicollinearity almost always indicates a specification mistake. In the rare instances where that isn't the case, the only cure is to get more data.

You might want to post your EViews workfile, including the equation you wish to estimate.

Re: MULTICOLINEARITY

Posted: Thu Aug 28, 2014 6:54 pm
by Lol38
I mean that the multicolinearity is very high.

I have tried with Variance Inflation Factors but even deleting the serie that have the highest VIF, the problem persist.

Re: MULTICOLINEARITY

Posted: Thu Aug 28, 2014 7:00 pm
by Lol38
It is very difficult to post the workfile because it is a mix from different data sources but here i share my programme.
tesis.prg
(28.72 KiB) Downloaded 315 times

Re: MULTICOLINEARITY

Posted: Thu Aug 28, 2014 8:04 pm
by startz
You don't need to post the workfile if you don't want to, but no one can run the program without it. Nor is there anyway to tell what the data looks like or which of the 100+ equations has the problem.

Re: MULTICOLINEARITY

Posted: Thu Aug 28, 2014 8:25 pm
by Lol38
Ok, the equation looks like this.
equation.png
equation.png (104.68 KiB) Viewed 5376 times

Re: MULTICOLINEARITY

Posted: Thu Aug 28, 2014 8:35 pm
by startz
Something doesn't make any sense. When EViews says "near singular matrix," it won't estimate the equation.