# Non-Existent Beta Matrix

#### floriandotti

##### New Member

Consider only a simple linear regression model for this please.

so, Y(vector) = X matrix * Beta matrix + Error(vector)

under what conditions is the estimate of Beta nonexistent?

thanks,

#### vinux

##### Dark Knight
The model is
$$y = X\beta + \varepsilon,$$
OLS estimate of beta is
$$\hat\beta = (X'X)^{-1} X'y$$
If X'X is singular matrix then beta estimates will not be generated using the above equation.
This may happen when you have less observations (or obs < parameters.)