Assumptions(continued) Still need to assume that no x is constant and that there is no perfect collinearity e Note we have skipped the assumption of a random sample e The key impact of the random sample assumption is that each u: is independent Our strict exogeneity assumption takes care of it in this case Economics 20- Prof anderson 7Economics 20 - Prof. Anderson 7 Assumptions (continued) Still need to assume that no x is constant, and that there is no perfect collinearity Note we have skipped the assumption of a random sample The key impact of the random sample assumption is that each ui is independent Our strict exogeneity assumption takes care of it in this case