# Re: st: How -ovtest- works?

 From Richard Williams To statalist@hsphsun2.harvard.edu Subject Re: st: How -ovtest- works? Date Wed, 09 Jun 2004 12:25:31 -0500

```At 07:04 PM 6/9/2004 +0200, Andreas Kuhn wrote:

```
- ovtest - also includes the fourth power of yhat as a regressor. thus, including yhat^4 in your regression should give the same result as ovtest.
That is part of the problem, but not all. As the reference manual N-R points out, p. 381, the y-hat variable is normalized to have mean 0 and variance one before powers are taken. So, try this:

. sysuse auto

. quietly reg price mpg weight foreign

. predict y
(option xb assumed; fitted values)

. quietly sum y

. replace y = (y - r(mean))/r(sd)

. gen y2 = y^2

. gen y3 = y^3

. gen y4 = y^4

. quietly reg price mpg weight foreign y2 y3 y4

. test y2 y3 y4

( 1) y2 = 0
( 2) y3 = 0
( 3) y4 = 0

F( 3, 67) = 15.31
Prob > F = 0.0000

.

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