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A new liu type of estimator for the restricted SUR estimator

Journal of Modern Applied Statistical Methods, ISSN: 1538-9472, Vol: 18, Issue: 1, Page: 2-11
2019
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Article Description

A new Liu type of estimator for the seemingly unrelated regression (SUR) models is proposed that may be used when estimating the parameters vector in the presence of multicollinearity if the it is suspected to belong to a linear subspace. The dispersion matrices and the mean squared error (MSE) are derived. The new estimator may have a lower MSE than the traditional estimators. It was shown using simulation techniques the new shrinkage estimator outperforms the commonly used estimators in the presence of multicollinearity.

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