What Is Omitted Variable Bias?

Omitted variable bias is a type of selection bias that occurs in regression analysis when we don’t include the right controls.

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[gabemando]

You guys are really helping me out in my econ studies

[Artonox]

wow the gears infographic was really helpful!

[FlamingBasketballClub]

Is there going to be more videos in regards to the trade wars and international economics?

[mathsissimplenice]

That's exactly what I needed. You saved my life. Thank you!

[davecullins]

Sounds a lot like a spurious relationship - are the two terms synonyms or did they accidentally explain what a spurious relationship is when they should have explained what omitted variable bias is?

[emmanuelameyaw]

If parents IQ does not affect the amount of books but only academic achievement, then we do not have omitted variable bias. Why is that?

[crashmancer]

This would be more widely persuasive with another confounding variable for the example, like wealth. Some people become irrational when you mention IQ.

[MJPerformance]

Omitted variable bias is leaving out an essential variable.

[accountingprofessor]

the relation between the number of books and academic performance is spurious! You didn't explain this correctly.

[alumi]

correlation doesn't imply causation

[tylerkwong]

Essentially stop ppl from using regression analysis...🤣 When I simply want to see the relationship of y and x1, now, you are telling me I ''may" miss out x2, x3, x4... so I end up thinking so hard what I might have missed... Not at all an encouraging theory. How do I know I don't miss out x5 when I have eventually got x2 - x4...

[fivitaliy]

Music is lout, voice is quiet and she speaks to fast

[kevincorlett]

This was a wonderfully succinct and efficient explanation of the principle, but I sure wish you would have used an example that didn't involve the fairly well discredited concept of IQ. The "Intelligence Quotient" is and idea I haven't really heard taken seriously by entire adult life, except by racists who like it because it provides a veneer of objective "science" to their bigoted ideas. Using something like the parents' education level or level of affluence would've served the lesson exactly as well, while also providing an example of an actual real-life metric that might actually be a significant variable in the question at hand.