Regression via ordinary least squares (OLS) is a commonly applied statistical technique in political science. However, when the dependent variable is dichotomous (0-1) rather than continuous, ordinary least squares becomes an inefficient estimation technique, and the underlying linear probability model (LPM) that is being estimated represents a poor apriori choice of model specification (Aldric...

Beta is found to be a function of several leading economic indicators and government policy variables within the context of the Variable Beta Model which incorporates economic characteristics in the single index model in a multiplicative manner. When contemporaneous macroeconomic descriptors are replaced with reporting-period-lagged macroeconomic descriptors, in the Lagged Variable Beta Model, ...