This is very basic to you but I need your view on it
Please guide me. I have posited two equation (1) and (2) with same set of RHS variables to test the hypothesis that responsiveness of equation (1) coefficients are higher than equation (2)…….based on some theory..
Manufacturing/Total Exports = α +β1 Tariff +β2 Transport……+µ (1)
(Total Exports-Manufacturing)/Total Exports= γ1 +δ2Tariff + δ2 Transport……+µ (2)
So in the LHS its a share. Is there a problem in estimating these equations......and testing the statistical differences in variables.
Ho: β =δ
Hi: β> δ
Thanks in advance.
Anita
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