# Thread: Need Help for explain variables

1. ## Need Help for explain variables

Hello Dear Members,
I am doing a research on Corporate R&D and market capitalization with 5 variables.
There in no co linearity between my study variables.
R2 are good. Model pass F stat. P value of F stat is also very good. All variables show good and desired coefficients as well as desired positive and negative effect.
The only problem is that 2 of my variables not pass t test and show insignificant effect.
Kindly help me how to explain this situation.
Thanks

2. ## Re: Need Help for explain variables

hi,
best would be to post the results of the regression here. When you say, there is no collinearity, do you mean the VIF value is low?

In principle, the fact that some variables have high p-values means that either they have no influence or that your sample size is too low (or your VIF is high) . If you have an adequate sample size, try building the model without the insignificanz variables and see how that model performs.

regards

3. ## Re: Need Help for explain variables

VIF value is very low i-e mean VIF 1.02. as well as by pearson correlation matrix. no collinearity shown between variable.

4. ## Re: Need Help for explain variables

Are you asking, "if I have a significant F-test for the model -why aren't these variables significant?" If so, the f-test for the model is just saying that the model explains a significant amount of the variance. But some crappy variables could be coming along for a free ride in the model. You need to tell us more about the model and variables.

Are you using an adjusted R^2, and how much does it change when you exclude the variables? Can you calculate the variables contribution to the R^2 (e.g., partial omega^2) and test its significance? As rogojel eluded to, do these variable have a big coefficient value, but a bigger standard error? Or do they not even have a big coefficient value?

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