{"version":"1.0.0","segments":[{"speaker":"Patrick","startTime":5.1,"endTime":8.16,"body":"Welcome my name is"},{"speaker":"Patrick","startTime":5.1,"endTime":8.16,"body":"Patrick Curran and along with my"},{"speaker":"Patrick","startTime":8.16,"endTime":11.94,"body":"never underestimated friend Greg"},{"speaker":"Patrick","startTime":8.16,"endTime":11.94,"body":"Hancock we make up quantity"},{"speaker":"Patrick","startTime":11.94,"endTime":15.42,"body":"dude. We are a podcast dedicated"},{"speaker":"Patrick","startTime":11.94,"endTime":15.42,"body":"to all things quantitative"},{"speaker":"Patrick","startTime":15.42,"endTime":18.42,"body":"ranging from the irrelevant to"},{"speaker":"Patrick","startTime":15.42,"endTime":18.42,"body":"the completely irrelevant. In"},{"speaker":"Patrick","startTime":18.42,"endTime":21.45,"body":"this week's episode Greg and I"},{"speaker":"Patrick","startTime":18.42,"endTime":21.45,"body":"explore the often neglected"},{"speaker":"Patrick","startTime":21.45,"endTime":24.75,"body":"method of two stage least"},{"speaker":"Patrick","startTime":21.45,"endTime":24.75,"body":"squares. We take a walk down"},{"speaker":"Patrick","startTime":24.75,"endTime":28.08,"body":"memory lane to explore its"},{"speaker":"Patrick","startTime":24.75,"endTime":28.08,"body":"origins and then drag it kicking"},{"speaker":"Patrick","startTime":28.08,"endTime":31.56,"body":"and screaming into the 21st"},{"speaker":"Patrick","startTime":28.08,"endTime":31.56,"body":"century for much promising use"},{"speaker":"Patrick","startTime":31.56,"endTime":34.8,"body":"within the latent variable"},{"speaker":"Patrick","startTime":31.56,"endTime":34.8,"body":"model. Along the way, we also"},{"speaker":"Patrick","startTime":34.8,"endTime":39.9,"body":"discuss magic dishwashers been"},{"speaker":"Patrick","startTime":34.8,"endTime":39.9,"body":"underestimated. Blind pigs and"},{"speaker":"Patrick","startTime":39.9,"endTime":43.77,"body":"truffles, Sadie Hawkins,"},{"speaker":"Patrick","startTime":39.9,"endTime":43.77,"body":"intellectual spinning hook"},{"speaker":"Patrick","startTime":43.77,"endTime":48.87,"body":"kicks, fishers eight pack abs,"},{"speaker":"Patrick","startTime":43.77,"endTime":48.87,"body":"the fine print, Winston"},{"speaker":"Patrick","startTime":48.87,"endTime":54.12,"body":"Churchill vs Chewbacca, guinea"},{"speaker":"Patrick","startTime":48.87,"endTime":54.12,"body":"pigs, Mrs. Lincoln, butter"},{"speaker":"Patrick","startTime":54.12,"endTime":58.92,"body":"snacks and snipe punts. We hope"},{"speaker":"Patrick","startTime":54.12,"endTime":58.92,"body":"you enjoy this week's episode."},{"speaker":"Patrick","startTime":59.52,"endTime":63.57,"body":"Andrea and I have joked over"},{"speaker":"Patrick","startTime":59.52,"endTime":63.57,"body":"many years that we each take one"},{"speaker":"Patrick","startTime":63.57,"endTime":69.51,"body":"trip a semester. Just to remind"},{"speaker":"Patrick","startTime":63.57,"endTime":69.51,"body":"the other one what we do. Andrea"},{"speaker":"Patrick","startTime":69.51,"endTime":73.77,"body":"has said at one point that she"},{"speaker":"Patrick","startTime":69.51,"endTime":73.77,"body":"for a number of years believed"},{"speaker":"Patrick","startTime":73.77,"endTime":77.91,"body":"we had a magic dishwasher."},{"speaker":"Patrick","startTime":73.77,"endTime":77.91,"body":"Because it was just always"},{"speaker":"Patrick","startTime":77.91,"endTime":82.89,"body":"empty. And the Patrick 3000."},{"speaker":"Patrick","startTime":77.91,"endTime":82.89,"body":"Exactly. And it wasn't until I"},{"speaker":"Patrick","startTime":82.89,"endTime":86.22,"body":"was out of town for a couple of"},{"speaker":"Patrick","startTime":82.89,"endTime":86.22,"body":"days that she realized, oh, it's"},{"speaker":"Patrick","startTime":86.22,"endTime":91.53,"body":"not a magic dishwasher. But it"},{"speaker":"Patrick","startTime":86.22,"endTime":91.53,"body":"made me think of a really funny"},{"speaker":"Patrick","startTime":91.56,"endTime":96.09,"body":"research finding that's real."},{"speaker":"Patrick","startTime":91.56,"endTime":96.09,"body":"You have the two partners in a"},{"speaker":"Patrick","startTime":96.09,"endTime":102.24,"body":"dyad. feel out what percent does"},{"speaker":"Patrick","startTime":96.09,"endTime":102.24,"body":"each partner do in all the"},{"speaker":"Patrick","startTime":102.24,"endTime":107.25,"body":"household chores? And you say"},{"speaker":"Patrick","startTime":102.24,"endTime":107.25,"body":"which percent do you do? And"},{"speaker":"Patrick","startTime":107.25,"endTime":111.87,"body":"which percent does your partner"},{"speaker":"Patrick","startTime":107.25,"endTime":111.87,"body":"do? And I kid you not this is a"},{"speaker":"Patrick","startTime":111.87,"endTime":116.76,"body":"real published finding. It sums"},{"speaker":"Patrick","startTime":111.87,"endTime":116.76,"body":"on average to something like"},{"speaker":"Patrick","startTime":116.76,"endTime":123.06,"body":"158%. And it's really cool,"},{"speaker":"Patrick","startTime":116.76,"endTime":123.06,"body":"because it's actually a starting"},{"speaker":"Patrick","startTime":123.06,"endTime":128.19,"body":"point for marital therapy, which"},{"speaker":"Patrick","startTime":123.06,"endTime":128.19,"body":"is you underestimate what the"},{"speaker":"Patrick","startTime":128.19,"endTime":133.02,"body":"other person is doing. And it's"},{"speaker":"Patrick","startTime":128.19,"endTime":133.02,"body":"kind of empirical. You can hold"},{"speaker":"Patrick","startTime":133.02,"endTime":137.16,"body":"the two things side by side when"},{"speaker":"Patrick","startTime":133.02,"endTime":137.16,"body":"you're working with a couple and"},{"speaker":"Patrick","startTime":137.16,"endTime":141.69,"body":"say, okay, the percent that you"},{"speaker":"Patrick","startTime":137.16,"endTime":141.69,"body":"each do in household management"},{"speaker":"Patrick","startTime":141.69,"endTime":147.18,"body":"is 183%. It's just really"},{"speaker":"Patrick","startTime":141.69,"endTime":147.18,"body":"interesting. It made me start"},{"speaker":"Patrick","startTime":147.18,"endTime":151.11,"body":"thinking about not only the"},{"speaker":"Patrick","startTime":147.18,"endTime":151.11,"body":"things you underestimate in your"},{"speaker":"Patrick","startTime":151.11,"endTime":154.92,"body":"life, but the value of being"},{"speaker":"Patrick","startTime":151.11,"endTime":154.92,"body":"underestimated"},{"speaker":"Greg","startTime":154.95,"endTime":157.47,"body":"to surprise somebody with"},{"speaker":"Greg","startTime":154.95,"endTime":157.47,"body":"something that you got tucked up"},{"speaker":"Greg","startTime":157.47,"endTime":159.27,"body":"your sleeve. Exactly. Because"},{"speaker":"Greg","startTime":157.47,"endTime":159.27,"body":"then"},{"speaker":"Patrick","startTime":159.27,"endTime":162.33,"body":"if you don't do it,"},{"speaker":"Patrick","startTime":159.27,"endTime":162.33,"body":"they're not surprised. Right. So"},{"speaker":"Patrick","startTime":162.33,"endTime":165.3,"body":"if you like you have no"},{"speaker":"Patrick","startTime":162.33,"endTime":165.3,"body":"brilliant insight to share."},{"speaker":"Patrick","startTime":165.3,"endTime":168.15,"body":"They're like, yeah, no, I That's"},{"speaker":"Patrick","startTime":165.3,"endTime":168.15,"body":"exactly how I thought about"},{"speaker":"Patrick","startTime":168.15,"endTime":172.17,"body":"Patrick. But if you do somehow"},{"speaker":"Patrick","startTime":168.15,"endTime":172.17,"body":"blind pig with the truffle"},{"speaker":"Patrick","startTime":172.17,"endTime":175.59,"body":"yourself into some insight, as"},{"speaker":"Patrick","startTime":172.17,"endTime":175.59,"body":"they say, Wow, I did not expect"},{"speaker":"Patrick","startTime":175.59,"endTime":179.79,"body":"that. Yeah, exactly. One of my"},{"speaker":"Patrick","startTime":175.59,"endTime":179.79,"body":"favorite examples of this is you"},{"speaker":"Patrick","startTime":179.79,"endTime":182.79,"body":"and I both spent many, many"},{"speaker":"Patrick","startTime":179.79,"endTime":182.79,"body":"years in martial arts. And for a"},{"speaker":"Patrick","startTime":182.79,"endTime":185.97,"body":"few years, I did competitions"},{"speaker":"Patrick","startTime":182.79,"endTime":185.97,"body":"and they're organized"},{"speaker":"Patrick","startTime":185.97,"endTime":188.97,"body":"competitions are very"},{"speaker":"Patrick","startTime":185.97,"endTime":188.97,"body":"structured. I trained with a"},{"speaker":"Patrick","startTime":188.97,"endTime":191.73,"body":"buddy of mine who was much, much"},{"speaker":"Patrick","startTime":188.97,"endTime":191.73,"body":"better than I was he was"},{"speaker":"Patrick","startTime":191.73,"endTime":195.87,"body":"actually a fourth dawn in"},{"speaker":"Patrick","startTime":191.73,"endTime":195.87,"body":"Taekwondo and hapkido and he"},{"speaker":"Patrick","startTime":195.87,"endTime":199.77,"body":"would compete in the open"},{"speaker":"Patrick","startTime":195.87,"endTime":199.77,"body":"divisions, which is any rank,"},{"speaker":"Patrick","startTime":199.77,"endTime":204.63,"body":"any age, any size, and you just"},{"speaker":"Patrick","startTime":199.77,"endTime":204.63,"body":"line them up and fight them. He"},{"speaker":"Patrick","startTime":204.63,"endTime":208.77,"body":"had the most amazing strategy"},{"speaker":"Patrick","startTime":204.63,"endTime":208.77,"body":"when he would go into these"},{"speaker":"Patrick","startTime":208.77,"endTime":211.8,"body":"things. You've been to these"},{"speaker":"Patrick","startTime":208.77,"endTime":211.8,"body":"competitions as well. And it's"},{"speaker":"Patrick","startTime":211.8,"endTime":215.46,"body":"in some kind of Stadium. It's"},{"speaker":"Patrick","startTime":211.8,"endTime":215.46,"body":"filled with mats all over the"},{"speaker":"Patrick","startTime":215.46,"endTime":218.46,"body":"floor where all the different"},{"speaker":"Patrick","startTime":215.46,"endTime":218.46,"body":"ones are going on. And there's"},{"speaker":"Patrick","startTime":218.46,"endTime":222.69,"body":"this main center mat. Everybody"},{"speaker":"Patrick","startTime":218.46,"endTime":222.69,"body":"is wandering around like a"},{"speaker":"Patrick","startTime":222.69,"endTime":226.95,"body":"middle school, Sadie Hawkins"},{"speaker":"Patrick","startTime":222.69,"endTime":226.95,"body":"dance. And what you're doing is"},{"speaker":"Patrick","startTime":226.95,"endTime":230.01,"body":"watching your opponent's who"},{"speaker":"Patrick","startTime":226.95,"endTime":230.01,"body":"you're going to have to fight"},{"speaker":"Patrick","startTime":230.04,"endTime":234.63,"body":"sizing them up. Yep. And my"},{"speaker":"Patrick","startTime":230.04,"endTime":234.63,"body":"buddy and I would start to warm"},{"speaker":"Patrick","startTime":234.63,"endTime":240.6,"body":"up on the side and he would just"},{"speaker":"Patrick","startTime":234.63,"endTime":240.6,"body":"warm up in awkward, horrible for"},{"speaker":"Patrick","startTime":241.44,"endTime":245.88,"body":"deliberately, deliberately. The"},{"speaker":"Patrick","startTime":241.44,"endTime":245.88,"body":"big thing is, is he would kick"},{"speaker":"Patrick","startTime":245.88,"endTime":250.77,"body":"low and so he and I would trade"},{"speaker":"Patrick","startTime":245.88,"endTime":250.77,"body":"kicks in a warm up exercise, and"},{"speaker":"Patrick","startTime":250.77,"endTime":254.55,"body":"he would like never kick above"},{"speaker":"Patrick","startTime":250.77,"endTime":254.55,"body":"my waist. While his opponent is"},{"speaker":"Patrick","startTime":254.55,"endTime":258.42,"body":"watching this. Yeah, he bows in"},{"speaker":"Patrick","startTime":254.55,"endTime":258.42,"body":"for the fight, the fight starts,"},{"speaker":"Patrick","startTime":258.63,"endTime":261.99,"body":"you start to size up going"},{"speaker":"Patrick","startTime":258.63,"endTime":261.99,"body":"around, he throws up waist level"},{"speaker":"Patrick","startTime":261.99,"endTime":266.37,"body":"kick in the fight, does it a"},{"speaker":"Patrick","startTime":261.99,"endTime":266.37,"body":"second time. And the third time"},{"speaker":"Patrick","startTime":266.37,"endTime":269.07,"body":"knocks the guy out with the"},{"speaker":"Patrick","startTime":266.37,"endTime":269.07,"body":"spinning hook kick to the head"},{"speaker":"Patrick","startTime":269.67,"endTime":274.95,"body":"in his entire strategy was to"},{"speaker":"Patrick","startTime":269.67,"endTime":274.95,"body":"have the guy underestimate him."},{"speaker":"Patrick","startTime":275.43,"endTime":279.21,"body":"I think that's something to"},{"speaker":"Patrick","startTime":275.43,"endTime":279.21,"body":"aspire to. in life. I want to be"},{"speaker":"Patrick","startTime":279.24,"endTime":283.2,"body":"intellectually, you think I can"},{"speaker":"Patrick","startTime":279.24,"endTime":283.2,"body":"only throw a waist tie"},{"speaker":"Patrick","startTime":283.23,"endTime":286.83,"body":"roundhouse kick, and then"},{"speaker":"Patrick","startTime":283.23,"endTime":286.83,"body":"somehow have a spinning hook"},{"speaker":"Patrick","startTime":286.83,"endTime":290.34,"body":"kick that you completely don't"},{"speaker":"Patrick","startTime":286.83,"endTime":290.34,"body":"expect? That hasn't happened to"},{"speaker":"Patrick","startTime":290.34,"endTime":294.12,"body":"me intellectually yet, but I"},{"speaker":"Patrick","startTime":290.34,"endTime":294.12,"body":"keep striving for it."},{"speaker":"Greg","startTime":295.11,"endTime":298.59,"body":"Yeah, so you've been"},{"speaker":"Greg","startTime":295.11,"endTime":298.59,"body":"sandbagging for about 57 years,"},{"speaker":"Greg","startTime":298.77,"endTime":301.08,"body":"when it's your spinning Keep"},{"speaker":"Greg","startTime":298.77,"endTime":301.08,"body":"coming back to"},{"speaker":"Patrick","startTime":301.079,"endTime":307.289,"body":"a point, you don't"},{"speaker":"Patrick","startTime":301.079,"endTime":307.289,"body":"know. But you know, what does"},{"speaker":"Patrick","startTime":307.289,"endTime":311.819,"body":"have a spinning hook kick is"},{"speaker":"Patrick","startTime":307.289,"endTime":311.819,"body":"least squares estimation. Ooh,"},{"speaker":"Patrick","startTime":311.849,"endTime":314.819,"body":"this is what got me thinking"},{"speaker":"Patrick","startTime":311.849,"endTime":314.819,"body":"about it. So you and I, again,"},{"speaker":"Patrick","startTime":314.819,"endTime":318.719,"body":"put a lot of preparation into"},{"speaker":"Patrick","startTime":314.819,"endTime":318.719,"body":"today's episode. We talked last"},{"speaker":"Patrick","startTime":318.719,"endTime":323.309,"body":"night when 10 o'clock. I think"},{"speaker":"Patrick","startTime":318.719,"endTime":323.309,"body":"it was about 10 o'clock"},{"speaker":"Greg","startTime":323.339,"endTime":324.749,"body":"after you emptied the"},{"speaker":"Greg","startTime":323.339,"endTime":324.749,"body":"dishwasher."},{"speaker":"Patrick","startTime":327.449,"endTime":330.659,"body":"So I put a lot of"},{"speaker":"Patrick","startTime":327.449,"endTime":330.659,"body":"thought into this. And when I"},{"speaker":"Patrick","startTime":330.659,"endTime":333.749,"body":"think about episode number one"},{"speaker":"Patrick","startTime":330.659,"endTime":333.749,"body":"was ordinary least squares"},{"speaker":"Patrick","startTime":333.749,"endTime":336.269,"body":"episode number two was maximum"},{"speaker":"Patrick","startTime":333.749,"endTime":336.269,"body":"likelihood and maximum"},{"speaker":"Patrick","startTime":336.269,"endTime":340.589,"body":"likelihood we'll review a little"},{"speaker":"Patrick","startTime":336.269,"endTime":340.589,"body":"bit here today is spectacular."},{"speaker":"Patrick","startTime":340.799,"endTime":344.669,"body":"Maximum Likelihood is the"},{"speaker":"Patrick","startTime":340.799,"endTime":344.669,"body":"workhorse that we use in nearly"},{"speaker":"Patrick","startTime":344.669,"endTime":349.709,"body":"everything we do. But don't"},{"speaker":"Patrick","startTime":344.669,"endTime":349.709,"body":"underestimate least squares."},{"speaker":"Patrick","startTime":349.769,"endTime":353.879,"body":"Because it turns out least"},{"speaker":"Patrick","startTime":349.769,"endTime":353.879,"body":"squares has a spinning hook"},{"speaker":"Patrick","startTime":353.879,"endTime":354.299,"body":"kick,"},{"speaker":"Greg","startTime":354.36,"endTime":356.52,"body":"you think it's off on the"},{"speaker":"Greg","startTime":354.36,"endTime":356.52,"body":"side of the mat, just doing"},{"speaker":"Greg","startTime":356.52,"endTime":359.49,"body":"these low waist high kicks, just"},{"speaker":"Greg","startTime":356.52,"endTime":359.49,"body":"wait, just wait"},{"speaker":"Patrick","startTime":359.519,"endTime":364.229,"body":"when you don't expect"},{"speaker":"Patrick","startTime":359.519,"endTime":364.229,"body":"it. So I thought maybe what we"},{"speaker":"Patrick","startTime":364.229,"endTime":369.269,"body":"could do is do a super brief"},{"speaker":"Patrick","startTime":364.229,"endTime":369.269,"body":"review of least squares Gauss"},{"speaker":"Patrick","startTime":369.269,"endTime":372.659,"body":"Markov, and what are the"},{"speaker":"Patrick","startTime":369.269,"endTime":372.659,"body":"properties we get from that, and"},{"speaker":"Patrick","startTime":372.659,"endTime":376.889,"body":"then talk about ml similarly,"},{"speaker":"Patrick","startTime":372.659,"endTime":376.889,"body":"and then say, well, under what"},{"speaker":"Patrick","startTime":376.889,"endTime":380.429,"body":"condition might we kind of want"},{"speaker":"Patrick","startTime":376.889,"endTime":380.429,"body":"to go back to the table where"},{"speaker":"Patrick","startTime":380.429,"endTime":383.459,"body":"least squares is sitting because"},{"speaker":"Patrick","startTime":380.429,"endTime":383.459,"body":"we didn't realize they had a"},{"speaker":"Patrick","startTime":383.459,"endTime":386.759,"body":"spinning hook kick. So let's"},{"speaker":"Patrick","startTime":383.459,"endTime":386.759,"body":"start briefly with least"},{"speaker":"Patrick","startTime":386.759,"endTime":389.249,"body":"squares. So we talked about this"},{"speaker":"Patrick","startTime":386.759,"endTime":389.249,"body":"in episode one of this new"},{"speaker":"Patrick","startTime":389.249,"endTime":393.839,"body":"season. And what we're trying to"},{"speaker":"Patrick","startTime":389.249,"endTime":393.839,"body":"do is identify an optimal linear"},{"speaker":"Patrick","startTime":393.839,"endTime":396.539,"body":"combination of our set of"},{"speaker":"Patrick","startTime":393.839,"endTime":396.539,"body":"predictors that accounts for the"},{"speaker":"Patrick","startTime":396.539,"endTime":400.079,"body":"maximal amount of variance that"},{"speaker":"Patrick","startTime":396.539,"endTime":400.079,"body":"we observed in our dependent"},{"speaker":"Patrick","startTime":400.079,"endTime":403.199,"body":"variable, we typically are going"},{"speaker":"Patrick","startTime":400.079,"endTime":403.199,"body":"to assume continuity of the"},{"speaker":"Patrick","startTime":403.199,"endTime":406.739,"body":"dependent variable. In old"},{"speaker":"Patrick","startTime":403.199,"endTime":406.739,"body":"school, ordinary least squares,"},{"speaker":"Patrick","startTime":406.739,"endTime":410.429,"body":"we don't have to assume"},{"speaker":"Patrick","startTime":406.739,"endTime":410.429,"body":"normality. But we do have to"},{"speaker":"Patrick","startTime":410.429,"endTime":414.089,"body":"invoke that assumption to get"},{"speaker":"Patrick","startTime":410.429,"endTime":414.089,"body":"standard errors. Alright, Gauss"},{"speaker":"Patrick","startTime":414.089,"endTime":419.789,"body":"Markov gives us the Kelvin ball"},{"speaker":"Patrick","startTime":414.089,"endTime":419.789,"body":"rules that we have to meet in"},{"speaker":"Patrick","startTime":419.819,"endTime":424.439,"body":"order for least squares to be"},{"speaker":"Patrick","startTime":419.819,"endTime":424.439,"body":"the best Linear Unbiased"},{"speaker":"Patrick","startTime":424.439,"endTime":427.229,"body":"Estimator. So we talked about"},{"speaker":"Patrick","startTime":424.439,"endTime":427.229,"body":"that in the episode is that"},{"speaker":"Patrick","startTime":427.439,"endTime":432.569,"body":"under assumptions Oh, well, less"},{"speaker":"Patrick","startTime":427.439,"endTime":432.569,"body":"is blue BL UE best Linear"},{"speaker":"Patrick","startTime":432.569,"endTime":433.979,"body":"Unbiased Estimator."},{"speaker":"Patrick","startTime":439.44,"endTime":442.71,"body":"And we won't go through the"},{"speaker":"Patrick","startTime":439.44,"endTime":442.71,"body":"assumptions in detail again. But"},{"speaker":"Patrick","startTime":442.74,"endTime":446.79,"body":"we have things like continuity"},{"speaker":"Patrick","startTime":442.74,"endTime":446.79,"body":"normality, that the"},{"speaker":"Patrick","startTime":446.79,"endTime":450.93,"body":"distributions of the predictors"},{"speaker":"Patrick","startTime":446.79,"endTime":450.93,"body":"are fixed in known, what that"},{"speaker":"Patrick","startTime":450.93,"endTime":454.68,"body":"means is their distribution free"},{"speaker":"Patrick","startTime":450.93,"endTime":454.68,"body":"for the predictors, but we are"},{"speaker":"Patrick","startTime":454.68,"endTime":458.52,"body":"also assuming that there is no"},{"speaker":"Patrick","startTime":454.68,"endTime":458.52,"body":"measurement error. And then we"},{"speaker":"Patrick","startTime":458.52,"endTime":464.25,"body":"get into some tricky ones, the"},{"speaker":"Patrick","startTime":458.52,"endTime":464.25,"body":"model is properly specified. And"},{"speaker":"Patrick","startTime":464.28,"endTime":467.34,"body":"one that I don't know about you"},{"speaker":"Patrick","startTime":464.28,"endTime":467.34,"body":"all out there who have taught"},{"speaker":"Patrick","startTime":467.34,"endTime":472.47,"body":"this I routinely sweep under the"},{"speaker":"Patrick","startTime":467.34,"endTime":472.47,"body":"rug and pretend does not exist,"},{"speaker":"Patrick","startTime":472.53,"endTime":477.36,"body":"the covariance between the"},{"speaker":"Patrick","startTime":472.53,"endTime":477.36,"body":"predictor and the disturbance."},{"speaker":"Patrick","startTime":477.6,"endTime":481.29,"body":"Alright, so let's call the"},{"speaker":"Patrick","startTime":477.6,"endTime":481.29,"body":"residual and our least squares"},{"speaker":"Patrick","startTime":481.29,"endTime":485.07,"body":"regression model. What should we"},{"speaker":"Patrick","startTime":481.29,"endTime":485.07,"body":"call it? r sub i? Okay, so"},{"speaker":"Patrick","startTime":485.07,"endTime":489.66,"body":"picture in your mind's eye, the"},{"speaker":"Patrick","startTime":485.07,"endTime":489.66,"body":"covariance between x sub i and r"},{"speaker":"Patrick","startTime":489.66,"endTime":493.38,"body":"sub i equals zero, right? Just"},{"speaker":"Patrick","startTime":489.66,"endTime":493.38,"body":"standard one. We make that"},{"speaker":"Patrick","startTime":493.41,"endTime":498.09,"body":"assumption all the time. I never"},{"speaker":"Patrick","startTime":493.41,"endTime":498.09,"body":"talked about that. I just say,"},{"speaker":"Patrick","startTime":498.09,"endTime":500.82,"body":"yep, that's an assumption under"},{"speaker":"Patrick","startTime":498.09,"endTime":500.82,"body":"Gauss Markov. Well, we're going"},{"speaker":"Patrick","startTime":500.82,"endTime":505.56,"body":"to pick away at that a lot today"},{"speaker":"Patrick","startTime":500.82,"endTime":505.56,"body":"of well, what if there is a"},{"speaker":"Patrick","startTime":505.56,"endTime":509.01,"body":"nonzero covariance? Where does"},{"speaker":"Patrick","startTime":505.56,"endTime":509.01,"body":"that come from? What do we do"},{"speaker":"Patrick","startTime":509.01,"endTime":513.87,"body":"about it? And so anyway, if you"},{"speaker":"Patrick","startTime":509.01,"endTime":513.87,"body":"meet Gauss Markov, there is no"},{"speaker":"Patrick","startTime":513.9,"endTime":517.5,"body":"better set of estimates that"},{"speaker":"Patrick","startTime":513.9,"endTime":517.5,"body":"lead to a smaller sum of the"},{"speaker":"Patrick","startTime":517.5,"endTime":522.27,"body":"squared residuals than your OLS"},{"speaker":"Patrick","startTime":517.5,"endTime":522.27,"body":"estimates. So that was all of"},{"speaker":"Patrick","startTime":522.27,"endTime":525.36,"body":"episode one. I like it. Well, we"},{"speaker":"Patrick","startTime":522.27,"endTime":525.36,"body":"could have done that a whole lot"},{"speaker":"Patrick","startTime":525.36,"endTime":530.91,"body":"shorter. Then we said, Wait,"},{"speaker":"Patrick","startTime":525.36,"endTime":530.91,"body":"who's that flexing in front of"},{"speaker":"Patrick","startTime":530.91,"endTime":533.7,"body":"the mirror over there? Ra"},{"speaker":"Patrick","startTime":530.91,"endTime":533.7,"body":"Fisher."},{"speaker":"Greg","startTime":534.84,"endTime":536.34,"body":"Fisher unopposed down?"},{"speaker":"Patrick","startTime":537.69,"endTime":541.26,"body":"Yep. And we, we decided"},{"speaker":"Patrick","startTime":537.69,"endTime":541.26,"body":"that your achievement in your"},{"speaker":"Patrick","startTime":541.26,"endTime":545.19,"body":"early 20s Was you grew an orange"},{"speaker":"Patrick","startTime":541.26,"endTime":545.19,"body":"mustache, which I have to admit"},{"speaker":"Patrick","startTime":545.19,"endTime":550.23,"body":"I had a nightmare about. And my"},{"speaker":"Patrick","startTime":545.19,"endTime":550.23,"body":"achievement was I saw Van Halen"},{"speaker":"Patrick","startTime":550.26,"endTime":555.18,"body":"with David Lee Roth and Sammy"},{"speaker":"Patrick","startTime":550.26,"endTime":555.18,"body":"Hagar, and RA Fisher at that"},{"speaker":"Patrick","startTime":555.18,"endTime":559.74,"body":"same age invented maximum"},{"speaker":"Patrick","startTime":555.18,"endTime":559.74,"body":"likelihood. So give us a"},{"speaker":"Patrick","startTime":559.74,"endTime":561.81,"body":"whirlwind tour of maximum"},{"speaker":"Patrick","startTime":559.74,"endTime":561.81,"body":"likelihood,"},{"speaker":"Greg","startTime":561.84,"endTime":564.09,"body":"I just keep picturing"},{"speaker":"Greg","startTime":561.84,"endTime":564.09,"body":"Fisher, like flexing in the"},{"speaker":"Greg","startTime":564.09,"endTime":565.74,"body":"mirror is eight pack abs"},{"speaker":"Patrick","startTime":565.8,"endTime":567.03,"body":"and an orange"},{"speaker":"Patrick","startTime":565.8,"endTime":567.03,"body":"moustache."},{"speaker":"Greg","startTime":568.8,"endTime":571.47,"body":"Alright, so as we talked"},{"speaker":"Greg","startTime":568.8,"endTime":571.47,"body":"about last episode, maximum"},{"speaker":"Greg","startTime":571.47,"endTime":574.44,"body":"likelihood looks at things from"},{"speaker":"Greg","startTime":571.47,"endTime":574.44,"body":"a different perspective, as you"},{"speaker":"Greg","startTime":574.44,"endTime":577.26,"body":"would say, it's Calvin Ball, it"},{"speaker":"Greg","startTime":574.44,"endTime":577.26,"body":"changes the rules on you is"},{"speaker":"Greg","startTime":577.26,"endTime":581.22,"body":"very, very clever. The main"},{"speaker":"Greg","startTime":577.26,"endTime":581.22,"body":"theme of it is that you want to"},{"speaker":"Greg","startTime":581.22,"endTime":584.85,"body":"try to figure out what the"},{"speaker":"Greg","startTime":581.22,"endTime":584.85,"body":"parameters would have to be like"},{"speaker":"Greg","startTime":584.85,"endTime":588.27,"body":"in a population to maximize the"},{"speaker":"Greg","startTime":584.85,"endTime":588.27,"body":"likelihood of the data that you"},{"speaker":"Greg","startTime":588.27,"endTime":593.82,"body":"have in your hand. And there"},{"speaker":"Greg","startTime":588.27,"endTime":593.82,"body":"are, as we said, rage hoc ways"},{"speaker":"Greg","startTime":593.82,"endTime":598.59,"body":"of doing that. Where you just"},{"speaker":"Greg","startTime":593.82,"endTime":598.59,"body":"sort of turn the computer loose"},{"speaker":"Greg","startTime":598.59,"endTime":601.23,"body":"to try to find those things and"},{"speaker":"Greg","startTime":598.59,"endTime":601.23,"body":"then There are elegant, sexy"},{"speaker":"Greg","startTime":601.23,"endTime":607.17,"body":"Hulk ways mathematical ways to"},{"speaker":"Greg","startTime":601.23,"endTime":607.17,"body":"try to derive those six. But"},{"speaker":"Greg","startTime":607.17,"endTime":610.14,"body":"they rest on some particular"},{"speaker":"Greg","startTime":607.17,"endTime":610.14,"body":"assumptions. And one of them"},{"speaker":"Greg","startTime":610.14,"endTime":614.01,"body":"right out of the gate is that"},{"speaker":"Greg","startTime":610.14,"endTime":614.01,"body":"the observations themselves are"},{"speaker":"Greg","startTime":614.01,"endTime":616.98,"body":"independent. And that's because"},{"speaker":"Greg","startTime":614.01,"endTime":616.98,"body":"in order to characterize the"},{"speaker":"Greg","startTime":616.98,"endTime":620.34,"body":"likelihood of all of the data,"},{"speaker":"Greg","startTime":616.98,"endTime":620.34,"body":"we take the product of the"},{"speaker":"Greg","startTime":620.34,"endTime":623.67,"body":"likelihoods for each of the"},{"speaker":"Greg","startTime":620.34,"endTime":623.67,"body":"individuals. And you can only do"},{"speaker":"Greg","startTime":623.67,"endTime":626.37,"body":"that if those things are"},{"speaker":"Greg","startTime":623.67,"endTime":626.37,"body":"independent. We also in order to"},{"speaker":"Greg","startTime":626.37,"endTime":629.16,"body":"figure out a likelihood of"},{"speaker":"Greg","startTime":626.37,"endTime":629.16,"body":"anything, we have to have some"},{"speaker":"Greg","startTime":629.16,"endTime":632.64,"body":"distribution assumed, I can't"},{"speaker":"Greg","startTime":629.16,"endTime":632.64,"body":"tell you how likely a particular"},{"speaker":"Greg","startTime":632.64,"endTime":635.97,"body":"case is unless I know the"},{"speaker":"Greg","startTime":632.64,"endTime":635.97,"body":"distribution that that case is a"},{"speaker":"Greg","startTime":635.97,"endTime":638.82,"body":"part of a normal distribution,"},{"speaker":"Greg","startTime":635.97,"endTime":638.82,"body":"or more generally, a"},{"speaker":"Greg","startTime":638.82,"endTime":642.66,"body":"multivariate normal distribution"},{"speaker":"Greg","startTime":638.82,"endTime":642.66,"body":"is what Fisher primarily had"},{"speaker":"Greg","startTime":642.66,"endTime":645.87,"body":"assumed and what serves as the"},{"speaker":"Greg","startTime":642.66,"endTime":645.87,"body":"basis for a lot of the things"},{"speaker":"Greg","startTime":645.87,"endTime":648.63,"body":"that you and I do. So there's"},{"speaker":"Greg","startTime":645.87,"endTime":648.63,"body":"this baked in distributional"},{"speaker":"Greg","startTime":648.63,"endTime":651.81,"body":"assumption about multivariate"},{"speaker":"Greg","startTime":648.63,"endTime":651.81,"body":"normality. That gives us the"},{"speaker":"Greg","startTime":651.81,"endTime":654.45,"body":"ability to figure out what the"},{"speaker":"Greg","startTime":651.81,"endTime":654.45,"body":"likelihood is of each"},{"speaker":"Greg","startTime":654.45,"endTime":657.09,"body":"observation within that"},{"speaker":"Greg","startTime":654.45,"endTime":657.09,"body":"distribution. The assumption"},{"speaker":"Greg","startTime":657.09,"endTime":660.0,"body":"that I can't get rid of in"},{"speaker":"Greg","startTime":657.09,"endTime":660.0,"body":"maximum likelihood is something"},{"speaker":"Greg","startTime":660.0,"endTime":663.21,"body":"that you just alluded to that is"},{"speaker":"Greg","startTime":660.0,"endTime":663.21,"body":"that assumption that the"},{"speaker":"Greg","startTime":663.21,"endTime":667.86,"body":"predictor is independent of the"},{"speaker":"Greg","startTime":663.21,"endTime":667.86,"body":"error. I can cast that more"},{"speaker":"Greg","startTime":667.86,"endTime":671.97,"body":"broadly as the assumption that"},{"speaker":"Greg","startTime":667.86,"endTime":671.97,"body":"the model is right. Anytime"},{"speaker":"Greg","startTime":671.97,"endTime":674.52,"body":"anybody says, Yeah, well, you"},{"speaker":"Greg","startTime":671.97,"endTime":674.52,"body":"know, assuming the model is"},{"speaker":"Greg","startTime":674.52,"endTime":677.85,"body":"right, there should be a little"},{"speaker":"Greg","startTime":674.52,"endTime":677.85,"body":"bell that goes off in your head"},{"speaker":"Greg","startTime":677.85,"endTime":680.73,"body":"that says, Wow, wait a minute."},{"speaker":"Greg","startTime":677.85,"endTime":680.73,"body":"What do you mean, assuming the"},{"speaker":"Greg","startTime":680.73,"endTime":684.12,"body":"model is right? There's a lot of"},{"speaker":"Greg","startTime":680.73,"endTime":684.12,"body":"stuff that goes on in these"},{"speaker":"Greg","startTime":684.12,"endTime":687.6,"body":"models, when we are doing"},{"speaker":"Greg","startTime":684.12,"endTime":687.6,"body":"maximum likelihood for something"},{"speaker":"Greg","startTime":687.6,"endTime":691.59,"body":"small, like a regression, or"},{"speaker":"Greg","startTime":687.6,"endTime":691.59,"body":"something a little bit more"},{"speaker":"Greg","startTime":691.59,"endTime":694.05,"body":"involved, like a logistic"},{"speaker":"Greg","startTime":691.59,"endTime":694.05,"body":"regression or something that is"},{"speaker":"Greg","startTime":694.05,"endTime":698.28,"body":"much more full blown. Whether"},{"speaker":"Greg","startTime":694.05,"endTime":698.28,"body":"it's a structural equation"},{"speaker":"Greg","startTime":698.28,"endTime":701.52,"body":"model, a confirmatory factor"},{"speaker":"Greg","startTime":698.28,"endTime":701.52,"body":"model, a mixture model, there"},{"speaker":"Greg","startTime":701.52,"endTime":705.6,"body":"are more and more opportunities"},{"speaker":"Greg","startTime":701.52,"endTime":705.6,"body":"for some aspect of your model to"},{"speaker":"Greg","startTime":705.6,"endTime":708.03,"body":"be wrong, we know that there are"},{"speaker":"Greg","startTime":705.6,"endTime":708.03,"body":"aspects for our model to be"},{"speaker":"Greg","startTime":708.03,"endTime":710.82,"body":"wrong, because we often consult"},{"speaker":"Greg","startTime":708.03,"endTime":710.82,"body":"modification indices to help"},{"speaker":"Greg","startTime":710.82,"endTime":714.72,"body":"nudge us toward truth, as if"},{"speaker":"Greg","startTime":710.82,"endTime":714.72,"body":"that's a thing. But it could be"},{"speaker":"Greg","startTime":714.72,"endTime":717.51,"body":"that their error covariance is"},{"speaker":"Greg","startTime":714.72,"endTime":717.51,"body":"missing, it could be that there"},{"speaker":"Greg","startTime":717.51,"endTime":721.74,"body":"are cross loadings missing, it"},{"speaker":"Greg","startTime":717.51,"endTime":721.74,"body":"could be more along the line of"},{"speaker":"Greg","startTime":721.74,"endTime":725.37,"body":"the relations themselves, the"},{"speaker":"Greg","startTime":721.74,"endTime":725.37,"body":"functional form of things where"},{"speaker":"Greg","startTime":725.37,"endTime":728.01,"body":"you think that it's a linear"},{"speaker":"Greg","startTime":725.37,"endTime":728.01,"body":"relation, it's not really"},{"speaker":"Greg","startTime":728.01,"endTime":731.85,"body":"exactly linear. There's so many"},{"speaker":"Greg","startTime":728.01,"endTime":731.85,"body":"places where a model can go"},{"speaker":"Greg","startTime":731.85,"endTime":735.84,"body":"wrong, and maximum likelihood is"},{"speaker":"Greg","startTime":731.85,"endTime":735.84,"body":"assuming that you got every"},{"speaker":"Greg","startTime":735.84,"endTime":739.17,"body":"single aspect of it, right."},{"speaker":"Greg","startTime":735.84,"endTime":739.17,"body":"Because if that doesn't happen,"},{"speaker":"Greg","startTime":739.2,"endTime":743.13,"body":"then all of the beautiful"},{"speaker":"Greg","startTime":739.2,"endTime":743.13,"body":"things, the holy trinity of"},{"speaker":"Greg","startTime":743.13,"endTime":747.51,"body":"unbiasness, consistency, and"},{"speaker":"Greg","startTime":743.13,"endTime":747.51,"body":"efficiency, those start to get"},{"speaker":"Greg","startTime":747.51,"endTime":750.39,"body":"very, very unstable. This, I"},{"speaker":"Greg","startTime":747.51,"endTime":750.39,"body":"think, is something that we"},{"speaker":"Greg","startTime":750.39,"endTime":753.9,"body":"really need to poke at this"},{"speaker":"Greg","startTime":750.39,"endTime":753.9,"body":"Achilles heel about a model"},{"speaker":"Greg","startTime":753.9,"endTime":757.86,"body":"being properly specified. And"},{"speaker":"Greg","startTime":753.9,"endTime":757.86,"body":"maybe where that estimator"},{"speaker":"Greg","startTime":757.86,"endTime":760.44,"body":"sitting off on the sideline,"},{"speaker":"Greg","startTime":757.86,"endTime":760.44,"body":"doing low kicks can come in and"},{"speaker":"Greg","startTime":760.44,"endTime":761.04,"body":"help us out."},{"speaker":"Patrick","startTime":761.219,"endTime":764.249,"body":"We're going to talk a"},{"speaker":"Patrick","startTime":761.219,"endTime":764.249,"body":"lot about Ken Bowens work in"},{"speaker":"Patrick","startTime":764.249,"endTime":767.339,"body":"this area. And he has a"},{"speaker":"Patrick","startTime":764.249,"endTime":767.339,"body":"wonderful line that I like,"},{"speaker":"Patrick","startTime":767.339,"endTime":772.769,"body":"which is the fine print on"},{"speaker":"Patrick","startTime":767.339,"endTime":772.769,"body":"maximum likelihood, we all focus"},{"speaker":"Patrick","startTime":772.799,"endTime":776.549,"body":"on exactly what you said,"},{"speaker":"Patrick","startTime":772.799,"endTime":776.549,"body":"maximum likelihood is a full"},{"speaker":"Patrick","startTime":776.549,"endTime":781.019,"body":"information estimator that"},{"speaker":"Patrick","startTime":776.549,"endTime":781.019,"body":"provides consistent, unbiased"},{"speaker":"Patrick","startTime":781.019,"endTime":784.349,"body":"and efficient estimates that are"},{"speaker":"Patrick","startTime":781.019,"endTime":784.349,"body":"asymptotically normally"},{"speaker":"Patrick","startTime":784.349,"endTime":787.409,"body":"distributed, so that we have"},{"speaker":"Patrick","startTime":784.349,"endTime":787.409,"body":"standard errors. And we have"},{"speaker":"Patrick","startTime":787.409,"endTime":791.489,"body":"test statistics. And then Bolin"},{"speaker":"Patrick","startTime":787.409,"endTime":791.489,"body":"talks about the fine print,"},{"speaker":"Patrick","startTime":791.579,"endTime":794.309,"body":"that's when you have"},{"speaker":"Patrick","startTime":791.579,"endTime":794.309,"body":"sufficiently large samples in"},{"speaker":"Patrick","startTime":794.309,"endTime":798.179,"body":"order for those properties to"},{"speaker":"Patrick","startTime":794.309,"endTime":798.179,"body":"kick in, that you have normally"},{"speaker":"Patrick","startTime":798.179,"endTime":802.019,"body":"distributed disturbances, and"},{"speaker":"Patrick","startTime":798.179,"endTime":802.019,"body":"that you have a properly"},{"speaker":"Patrick","startTime":802.019,"endTime":806.429,"body":"specified model. The extent to"},{"speaker":"Patrick","startTime":802.019,"endTime":806.429,"body":"which any or all of those are"},{"speaker":"Patrick","startTime":806.429,"endTime":811.349,"body":"violated actually undoes all of"},{"speaker":"Patrick","startTime":806.429,"endTime":811.349,"body":"those wonderful characteristics"},{"speaker":"Patrick","startTime":811.349,"endTime":814.529,"body":"to varying degrees, right?"},{"speaker":"Patrick","startTime":811.349,"endTime":814.529,"body":"That's right, it doesn't take it"},{"speaker":"Patrick","startTime":814.529,"endTime":818.249,"body":"out back and hit it with a"},{"speaker":"Patrick","startTime":814.529,"endTime":818.249,"body":"shovel. But we can no longer"},{"speaker":"Patrick","startTime":818.279,"endTime":822.959,"body":"brag about those characteristics"},{"speaker":"Patrick","startTime":818.279,"endTime":822.959,"body":"of maximum likelihood, think of"},{"speaker":"Patrick","startTime":822.959,"endTime":826.739,"body":"you out there in your own work."},{"speaker":"Patrick","startTime":822.959,"endTime":826.739,"body":"Do you have an asymptotically,"},{"speaker":"Patrick","startTime":826.739,"endTime":830.519,"body":"large sample? Do you have"},{"speaker":"Patrick","startTime":826.739,"endTime":830.519,"body":"multivariate normal data? And do"},{"speaker":"Patrick","startTime":830.519,"endTime":835.139,"body":"you have a properly specified"},{"speaker":"Patrick","startTime":830.519,"endTime":835.139,"body":"model? I'm going to guess that a"},{"speaker":"Patrick","startTime":835.139,"endTime":840.359,"body":"whole lot of people are saying,"},{"speaker":"Patrick","startTime":835.139,"endTime":840.359,"body":"Yeah,"},{"speaker":"Greg","startTime":840.81,"endTime":843.27,"body":"only when we simulate, I"},{"speaker":"Greg","startTime":840.81,"endTime":843.27,"body":"think that's the only"},{"speaker":"Patrick","startTime":843.9,"endTime":846.72,"body":"part of the problem is"},{"speaker":"Patrick","startTime":843.9,"endTime":846.72,"body":"is there's a whole lot of"},{"speaker":"Patrick","startTime":846.72,"endTime":851.16,"body":"simulation work out there. That"},{"speaker":"Patrick","startTime":846.72,"endTime":851.16,"body":"shows how amazing maximum"},{"speaker":"Patrick","startTime":851.16,"endTime":855.6,"body":"likelihood is when you are under"},{"speaker":"Patrick","startTime":851.16,"endTime":855.6,"body":"these unrealistic circumstances."},{"speaker":"Patrick","startTime":855.75,"endTime":860.64,"body":"Now to be very clear, there's an"},{"speaker":"Patrick","startTime":855.75,"endTime":860.64,"body":"entire body of work, some of"},{"speaker":"Patrick","startTime":860.64,"endTime":864.0,"body":"which you and I have contributed"},{"speaker":"Patrick","startTime":860.64,"endTime":864.0,"body":"to, to varying degrees, that is"},{"speaker":"Patrick","startTime":864.0,"endTime":866.76,"body":"looked at a thing called"},{"speaker":"Patrick","startTime":864.0,"endTime":866.76,"body":"robustness. Well, to what extent"},{"speaker":"Patrick","startTime":866.76,"endTime":870.78,"body":"is it robust to non normality?"},{"speaker":"Patrick","startTime":866.76,"endTime":870.78,"body":"There are conditions where you"},{"speaker":"Patrick","startTime":870.78,"endTime":873.99,"body":"say, no, there is a mis"},{"speaker":"Patrick","startTime":870.78,"endTime":873.99,"body":"specification, but we're still"},{"speaker":"Patrick","startTime":873.99,"endTime":876.3,"body":"close enough for government"},{"speaker":"Patrick","startTime":873.99,"endTime":876.3,"body":"work, we can still use it."},{"speaker":"Patrick","startTime":876.78,"endTime":881.55,"body":"They're spectacular ways that we"},{"speaker":"Patrick","startTime":876.78,"endTime":881.55,"body":"can correct for non normality"},{"speaker":"Patrick","startTime":882.03,"endTime":885.96,"body":"that we can get robust standard"},{"speaker":"Patrick","startTime":882.03,"endTime":885.96,"body":"errors and robust test"},{"speaker":"Patrick","startTime":885.96,"endTime":889.29,"body":"statistics. So this is not a we"},{"speaker":"Patrick","startTime":885.96,"endTime":889.29,"body":"have to do away with maximum"},{"speaker":"Patrick","startTime":889.29,"endTime":893.85,"body":"likelihood. Here's this least"},{"speaker":"Patrick","startTime":889.29,"endTime":893.85,"body":"squares guy sitting by himself"},{"speaker":"Patrick","startTime":893.88,"endTime":897.0,"body":"at Sadie Hawkins. Alright, for"},{"speaker":"Patrick","startTime":893.88,"endTime":897.0,"body":"those of you who are outside of"},{"speaker":"Patrick","startTime":897.0,"endTime":900.27,"body":"the United States, Sadie"},{"speaker":"Patrick","startTime":897.0,"endTime":900.27,"body":"Hawkins, is this God off? fourth"},{"speaker":"Patrick","startTime":900.27,"endTime":904.77,"body":"thing that schools impose on"},{"speaker":"Patrick","startTime":900.27,"endTime":904.77,"body":"preteens, it's usually in middle"},{"speaker":"Patrick","startTime":904.77,"endTime":909.54,"body":"school. But Sadie Hawkins is"},{"speaker":"Patrick","startTime":904.77,"endTime":909.54,"body":"this awful like Shark Tank of"},{"speaker":"Patrick","startTime":909.6,"endTime":914.82,"body":"pre pubescent kids wandering"},{"speaker":"Patrick","startTime":909.6,"endTime":914.82,"body":"around this room. But here is"},{"speaker":"Patrick","startTime":914.85,"endTime":919.62,"body":"least squares estimation. And"},{"speaker":"Patrick","startTime":914.85,"endTime":919.62,"body":"what Ken Bolin said is Hey,"},{"speaker":"Patrick","startTime":919.62,"endTime":924.21,"body":"guys, we've been working with"},{"speaker":"Patrick","startTime":919.62,"endTime":924.21,"body":"this stuff for 70 years. What if"},{"speaker":"Patrick","startTime":924.21,"endTime":928.89,"body":"we apply it to the SEM. So what"},{"speaker":"Patrick","startTime":924.21,"endTime":928.89,"body":"I would like to do is getting"},{"speaker":"Patrick","startTime":928.89,"endTime":932.46,"body":"our Wayback Machine and avoid"},{"speaker":"Patrick","startTime":928.89,"endTime":932.46,"body":"the temptation of bringing in"},{"speaker":"Patrick","startTime":932.46,"endTime":937.11,"body":"Churchill. Alright, I'm still on"},{"speaker":"Patrick","startTime":932.46,"endTime":937.11,"body":"volume three of Churchill's"},{"speaker":"Patrick","startTime":937.11,"endTime":937.98,"body":"biography,"},{"speaker":"Greg","startTime":938.52,"endTime":939.96,"body":"good that you didn't bring"},{"speaker":"Greg","startTime":938.52,"endTime":939.96,"body":"that in."},{"speaker":"Churchill","startTime":939.0,"endTime":943.41,"body":"We shall defend our"},{"speaker":"Churchill","startTime":939.0,"endTime":943.41,"body":"Island, whatever they cost may"},{"speaker":"Churchill","startTime":943.41,"endTime":945.72,"body":"be. We shall never surrender."},{"speaker":"Patrick","startTime":946.35,"endTime":948.78,"body":"I want to get in the"},{"speaker":"Patrick","startTime":946.35,"endTime":948.78,"body":"Wayback Machine, not invoke"},{"speaker":"Patrick","startTime":948.78,"endTime":953.22,"body":"Winston Churchill, but talk a"},{"speaker":"Patrick","startTime":948.78,"endTime":953.22,"body":"little bit about the historical"},{"speaker":"Patrick","startTime":953.22,"endTime":956.67,"body":"developments of what we're going"},{"speaker":"Patrick","startTime":953.22,"endTime":956.67,"body":"to call to stage least squares."},{"speaker":"Patrick","startTime":957.63,"endTime":964.14,"body":"And then Bolin in 96. He kind of"},{"speaker":"Patrick","startTime":957.63,"endTime":964.14,"body":"indicated it with a paper in 95,"},{"speaker":"Patrick","startTime":964.14,"endTime":969.15,"body":"but really hit a ball into play"},{"speaker":"Patrick","startTime":964.14,"endTime":969.15,"body":"in 96. Saying, we can take these"},{"speaker":"Patrick","startTime":969.15,"endTime":973.11,"body":"really old approaches and apply"},{"speaker":"Patrick","startTime":969.15,"endTime":973.11,"body":"them to a multiple indicator"},{"speaker":"Patrick","startTime":973.11,"endTime":976.08,"body":"lighting factor to address some"},{"speaker":"Patrick","startTime":973.11,"endTime":976.08,"body":"of the very things that we're"},{"speaker":"Patrick","startTime":976.08,"endTime":980.04,"body":"talking about. Yeah. And then we"},{"speaker":"Patrick","startTime":976.08,"endTime":980.04,"body":"could talk maybe at a 30,000"},{"speaker":"Patrick","startTime":980.04,"endTime":983.82,"body":"foot of what is to stage least"},{"speaker":"Patrick","startTime":980.04,"endTime":983.82,"body":"squares within the SEM, because"},{"speaker":"Patrick","startTime":983.82,"endTime":987.12,"body":"you could do a grad level class"},{"speaker":"Patrick","startTime":983.82,"endTime":987.12,"body":"on that topic. But how does that"},{"speaker":"Patrick","startTime":987.12,"endTime":988.53,"body":"sound as a storyline?"},{"speaker":"Greg","startTime":988.56,"endTime":991.53,"body":"This is a storyline I like"},{"speaker":"Greg","startTime":988.56,"endTime":991.53,"body":"the idea that least squares has"},{"speaker":"Greg","startTime":991.53,"endTime":994.29,"body":"been lurking in the background"},{"speaker":"Greg","startTime":991.53,"endTime":994.29,"body":"and laying in wait for its"},{"speaker":"Greg","startTime":994.29,"endTime":997.83,"body":"vengeance. So this is good,"},{"speaker":"Greg","startTime":994.29,"endTime":997.83,"body":"please square strikes back or"},{"speaker":"Greg","startTime":997.83,"endTime":999.0,"body":"whatever we would call this."},{"speaker":"Patrick","startTime":1003.799,"endTime":1008.449,"body":"So I had to work at"},{"speaker":"Patrick","startTime":1003.799,"endTime":1008.449,"body":"Churchill reference in and now"},{"speaker":"Patrick","startTime":1008.449,"endTime":1013.129,"body":"do your Chewbacca, and we can"},{"speaker":"Patrick","startTime":1008.449,"endTime":1013.129,"body":"just get it out of the way. Yep,"},{"speaker":"Patrick","startTime":1013.159,"endTime":1015.949,"body":"there we go. All right,"},{"speaker":"Patrick","startTime":1013.159,"endTime":1015.949,"body":"everybody, well mark that off on"},{"speaker":"Patrick","startTime":1015.949,"endTime":1018.349,"body":"the list. So should I start?"},{"speaker":"Greg","startTime":1018.439,"endTime":1021.079,"body":"Yeah, I'd like to know"},{"speaker":"Greg","startTime":1018.439,"endTime":1021.079,"body":"about the history of two stage"},{"speaker":"Greg","startTime":1021.079,"endTime":1023.269,"body":"least squares. All right, very"},{"speaker":"Greg","startTime":1021.079,"endTime":1023.269,"body":"briefly,"},{"speaker":"Patrick","startTime":1023.3,"endTime":1026.21,"body":"picture in your mind's"},{"speaker":"Patrick","startTime":1023.3,"endTime":1026.21,"body":"eye, everyone a predictor X"},{"speaker":"Patrick","startTime":1026.21,"endTime":1029.27,"body":"predicting y. And we're gonna"},{"speaker":"Patrick","startTime":1026.21,"endTime":1029.27,"body":"have a regression coefficient,"},{"speaker":"Patrick","startTime":1029.27,"endTime":1033.29,"body":"let's call it gamma. Greg and I"},{"speaker":"Patrick","startTime":1029.27,"endTime":1033.29,"body":"talked Two episodes ago, the"},{"speaker":"Patrick","startTime":1033.29,"endTime":1036.29,"body":"least squares estimate of that"},{"speaker":"Patrick","startTime":1033.29,"endTime":1036.29,"body":"is going to be the covariance"},{"speaker":"Patrick","startTime":1036.32,"endTime":1040.19,"body":"between X and Y divided by the"},{"speaker":"Patrick","startTime":1036.32,"endTime":1040.19,"body":"variance of x. Now that is"},{"speaker":"Patrick","startTime":1040.22,"endTime":1045.29,"body":"unbiased if the model is"},{"speaker":"Patrick","startTime":1040.22,"endTime":1045.29,"body":"properly specified, Gauss Korps"},{"speaker":"Patrick","startTime":1045.8,"endTime":1051.77,"body":"said, one of the assumptions is"},{"speaker":"Patrick","startTime":1045.8,"endTime":1051.77,"body":"Cove x, or where r is the"},{"speaker":"Patrick","startTime":1051.77,"endTime":1054.53,"body":"residual equals zero. That's"},{"speaker":"Patrick","startTime":1051.77,"endTime":1054.53,"body":"what we just talked about a few"},{"speaker":"Patrick","startTime":1054.53,"endTime":1058.34,"body":"minutes ago. But now picture in"},{"speaker":"Patrick","startTime":1054.53,"endTime":1058.34,"body":"your mind's eye that doesn't"},{"speaker":"Patrick","startTime":1058.34,"endTime":1062.48,"body":"hold. So picture it is a path"},{"speaker":"Patrick","startTime":1058.34,"endTime":1062.48,"body":"diagram is we have X predicting"},{"speaker":"Patrick","startTime":1062.51,"endTime":1067.64,"body":"y. But what if that's violated?"},{"speaker":"Patrick","startTime":1062.51,"endTime":1067.64,"body":"Well, we also have X predicting"},{"speaker":"Patrick","startTime":1067.7,"endTime":1071.69,"body":"our econometricians have been"},{"speaker":"Patrick","startTime":1067.7,"endTime":1071.69,"body":"talking about this for a"},{"speaker":"Patrick","startTime":1071.69,"endTime":1076.4,"body":"century. It's called an"},{"speaker":"Patrick","startTime":1071.69,"endTime":1076.4,"body":"endogeneity problem that x is"},{"speaker":"Patrick","startTime":1076.4,"endTime":1080.09,"body":"both related to y, but also to"},{"speaker":"Patrick","startTime":1076.4,"endTime":1080.09,"body":"the residual."},{"speaker":"Greg","startTime":1080.12,"endTime":1082.37,"body":"So here's the thing that I"},{"speaker":"Greg","startTime":1080.12,"endTime":1082.37,"body":"want to clarify, you know,"},{"speaker":"Greg","startTime":1082.37,"endTime":1084.92,"body":"whenever I run a regression,"},{"speaker":"Greg","startTime":1082.37,"endTime":1084.92,"body":"just I mean, like push the"},{"speaker":"Greg","startTime":1084.92,"endTime":1088.25,"body":"button or coded in whatever run"},{"speaker":"Greg","startTime":1084.92,"endTime":1088.25,"body":"a regression, I get out"},{"speaker":"Greg","startTime":1088.25,"endTime":1092.0,"body":"residuals that are uncorrelated"},{"speaker":"Greg","startTime":1088.25,"endTime":1092.0,"body":"with my predictor, I literally"},{"speaker":"Greg","startTime":1092.0,"endTime":1094.55,"body":"am subtracting things out and"},{"speaker":"Greg","startTime":1092.0,"endTime":1094.55,"body":"saying, Hey, this is the stuff"},{"speaker":"Greg","startTime":1094.55,"endTime":1097.49,"body":"that's left over, that's"},{"speaker":"Greg","startTime":1094.55,"endTime":1097.49,"body":"unrelated. So when you and I are"},{"speaker":"Greg","startTime":1097.49,"endTime":1100.55,"body":"talking about having predictors"},{"speaker":"Greg","startTime":1097.49,"endTime":1100.55,"body":"that are related to the"},{"speaker":"Greg","startTime":1100.55,"endTime":1104.99,"body":"residuals, correlated with the"},{"speaker":"Greg","startTime":1100.55,"endTime":1104.99,"body":"residuals, structurally"},{"speaker":"Greg","startTime":1104.99,"endTime":1108.95,"body":"impinging upon the residuals, or"},{"speaker":"Greg","startTime":1104.99,"endTime":1108.95,"body":"mutually influenced by something"},{"speaker":"Greg","startTime":1108.95,"endTime":1111.86,"body":"outside the system, what we're"},{"speaker":"Greg","startTime":1108.95,"endTime":1111.86,"body":"talking about is on a"},{"speaker":"Greg","startTime":1111.86,"endTime":1115.64,"body":"theoretical level, there are"},{"speaker":"Greg","startTime":1111.86,"endTime":1115.64,"body":"things that are contained in the"},{"speaker":"Greg","startTime":1115.64,"endTime":1119.84,"body":"residual things that are not x"},{"speaker":"Greg","startTime":1115.64,"endTime":1119.84,"body":"that are related to x. So this"},{"speaker":"Greg","startTime":1119.84,"endTime":1123.11,"body":"is an issue that is at a"},{"speaker":"Greg","startTime":1119.84,"endTime":1123.11,"body":"theoretical level, even prior to"},{"speaker":"Greg","startTime":1123.11,"endTime":1125.15,"body":"being able to do any kind of"},{"speaker":"Greg","startTime":1123.11,"endTime":1125.15,"body":"analysis, whether it's"},{"speaker":"Greg","startTime":1125.15,"endTime":1126.41,"body":"regression or something else."},{"speaker":"Patrick","startTime":1126.44,"endTime":1130.04,"body":"It's a byproduct of the"},{"speaker":"Patrick","startTime":1126.44,"endTime":1130.04,"body":"estimation, right? Yes, the mean"},{"speaker":"Patrick","startTime":1130.07,"endTime":1134.09,"body":"of the estimated residuals are"},{"speaker":"Patrick","startTime":1130.07,"endTime":1134.09,"body":"always zero, they have to be,"},{"speaker":"Patrick","startTime":1134.39,"endTime":1137.93,"body":"and the predictors are"},{"speaker":"Patrick","startTime":1134.39,"endTime":1137.93,"body":"uncorrelated with the residuals,"},{"speaker":"Patrick","startTime":1137.99,"endTime":1141.86,"body":"they have to be there's a"},{"speaker":"Patrick","startTime":1137.99,"endTime":1141.86,"body":"circularity, the reason they are"},{"speaker":"Patrick","startTime":1141.86,"endTime":1145.22,"body":"is we're making that assumption,"},{"speaker":"Patrick","startTime":1141.86,"endTime":1145.22,"body":"right. But that's just a sample"},{"speaker":"Patrick","startTime":1145.22,"endTime":1148.79,"body":"base. So you're exactly right,"},{"speaker":"Patrick","startTime":1145.22,"endTime":1148.79,"body":"we have x predicting y, and then"},{"speaker":"Patrick","startTime":1148.79,"endTime":1153.02,"body":"picturing your mind's eye in a"},{"speaker":"Patrick","startTime":1148.79,"endTime":1153.02,"body":"path diagram, X also predicting"},{"speaker":"Patrick","startTime":1153.05,"endTime":1156.5,"body":"are all right. So that's the"},{"speaker":"Patrick","startTime":1153.05,"endTime":1156.5,"body":"endogeneity problem. We're"},{"speaker":"Patrick","startTime":1156.5,"endTime":1159.05,"body":"assuming that's not there, but"},{"speaker":"Patrick","startTime":1156.5,"endTime":1159.05,"body":"pretend that it really is. And"},{"speaker":"Patrick","startTime":1159.05,"endTime":1161.96,"body":"we'll talk in a moment about how"},{"speaker":"Patrick","startTime":1159.05,"endTime":1161.96,"body":"that can happen. Now picture"},{"speaker":"Patrick","startTime":1161.99,"endTime":1166.43,"body":"omitting that effect. All right,"},{"speaker":"Patrick","startTime":1161.99,"endTime":1166.43,"body":"and we do our regression in the"},{"speaker":"Patrick","startTime":1166.43,"endTime":1170.75,"body":"usual way. Well, that gamma now"},{"speaker":"Patrick","startTime":1166.43,"endTime":1170.75,"body":"is going to be the covariance"},{"speaker":"Patrick","startTime":1170.75,"endTime":1174.02,"body":"between X and Y divided by the"},{"speaker":"Patrick","startTime":1170.75,"endTime":1174.02,"body":"variance of x. That's exactly"},{"speaker":"Patrick","startTime":1174.02,"endTime":1178.64,"body":"the beta like we usually have,"},{"speaker":"Patrick","startTime":1174.02,"endTime":1178.64,"body":"but two that is added the"},{"speaker":"Patrick","startTime":1178.64,"endTime":1183.98,"body":"covariance between X and R"},{"speaker":"Patrick","startTime":1178.64,"endTime":1183.98,"body":"divided by the variance of x"},{"speaker":"Patrick","startTime":1184.37,"endTime":1189.29,"body":"that's being absorbed in that"},{"speaker":"Patrick","startTime":1184.37,"endTime":1189.29,"body":"single gamma. And that's the"},{"speaker":"Patrick","startTime":1189.29,"endTime":1193.49,"body":"bias that we get. So if you have"},{"speaker":"Patrick","startTime":1189.29,"endTime":1193.49,"body":"X predicting y and you get a"},{"speaker":"Patrick","startTime":1193.49,"endTime":1197.93,"body":"gamma in your sample, if you"},{"speaker":"Patrick","startTime":1193.49,"endTime":1197.93,"body":"have an endogeneity problem,"},{"speaker":"Patrick","startTime":1197.96,"endTime":1200.99,"body":"that regression coefficient is"},{"speaker":"Patrick","startTime":1197.96,"endTime":1200.99,"body":"going to be biased. Yeah,"},{"speaker":"Greg","startTime":1201.02,"endTime":1203.42,"body":"this ties back beautifully"},{"speaker":"Greg","startTime":1201.02,"endTime":1203.42,"body":"to two things that we've talked"},{"speaker":"Greg","startTime":1203.42,"endTime":1206.39,"body":"about before. One is path"},{"speaker":"Greg","startTime":1203.42,"endTime":1206.39,"body":"tracing, everything that you"},{"speaker":"Greg","startTime":1206.39,"endTime":1209.48,"body":"just described is straight up"},{"speaker":"Greg","startTime":1206.39,"endTime":1209.48,"body":"path tracing, if you have the"},{"speaker":"Greg","startTime":1209.48,"endTime":1212.84,"body":"connections that you have there,"},{"speaker":"Greg","startTime":1209.48,"endTime":1212.84,"body":"those relations would fall right"},{"speaker":"Greg","startTime":1212.84,"endTime":1217.04,"body":"out. The other thing, which you"},{"speaker":"Greg","startTime":1212.84,"endTime":1217.04,"body":"raised years ago, is whack a"},{"speaker":"Greg","startTime":1217.04,"endTime":1219.89,"body":"mole. Yeah. And the problem that"},{"speaker":"Greg","startTime":1217.04,"endTime":1219.89,"body":"you have here is that when"},{"speaker":"Greg","startTime":1219.89,"endTime":1223.61,"body":"you're cutting off one avenue"},{"speaker":"Greg","startTime":1219.89,"endTime":1223.61,"body":"for AIX to be related to why,"},{"speaker":"Greg","startTime":1223.82,"endTime":1226.61,"body":"what's gonna happen, right? And"},{"speaker":"Greg","startTime":1223.82,"endTime":1226.61,"body":"the answer is, if anywhere else"},{"speaker":"Greg","startTime":1226.61,"endTime":1228.95,"body":"can try to compensate for that"},{"speaker":"Greg","startTime":1226.61,"endTime":1228.95,"body":"it's going to happen, and you've"},{"speaker":"Greg","startTime":1228.95,"endTime":1231.98,"body":"got one place for it to"},{"speaker":"Greg","startTime":1228.95,"endTime":1231.98,"body":"compensate. That is in the"},{"speaker":"Greg","startTime":1231.98,"endTime":1233.27,"body":"direct XY relation,"},{"speaker":"Patrick","startTime":1233.3,"endTime":1236.93,"body":"but we've determined"},{"speaker":"Patrick","startTime":1233.3,"endTime":1236.93,"body":"all of life as Whack a Mole. But"},{"speaker":"Patrick","startTime":1236.93,"endTime":1240.68,"body":"setting that aside, in"},{"speaker":"Patrick","startTime":1236.93,"endTime":1240.68,"body":"econometrics, this has been"},{"speaker":"Patrick","startTime":1240.68,"endTime":1245.18,"body":"dealt with for nearly a century."},{"speaker":"Patrick","startTime":1240.68,"endTime":1245.18,"body":"Sure, this is old school stuff,"},{"speaker":"Patrick","startTime":1245.33,"endTime":1249.47,"body":"we just tend to ignore it in"},{"speaker":"Patrick","startTime":1245.33,"endTime":1249.47,"body":"social sciences. There are many"},{"speaker":"Patrick","startTime":1249.47,"endTime":1252.77,"body":"ways this can happen. There are"},{"speaker":"Patrick","startTime":1249.47,"endTime":1252.77,"body":"three big ones, and they all"},{"speaker":"Patrick","startTime":1252.77,"endTime":1256.94,"body":"involve misspecified models to"},{"speaker":"Patrick","startTime":1252.77,"endTime":1256.94,"body":"varying degrees, right? One is"},{"speaker":"Patrick","startTime":1256.94,"endTime":1260.33,"body":"there's reverse or reciprocal"},{"speaker":"Patrick","startTime":1256.94,"endTime":1260.33,"body":"causation, right? And we do this"},{"speaker":"Patrick","startTime":1260.36,"endTime":1264.2,"body":"all the time. Is stress related"},{"speaker":"Patrick","startTime":1260.36,"endTime":1264.2,"body":"to depression is depression"},{"speaker":"Patrick","startTime":1264.2,"endTime":1267.38,"body":"related to alcohol use, I'm"},{"speaker":"Patrick","startTime":1264.2,"endTime":1267.38,"body":"gonna say depression predicts"},{"speaker":"Patrick","startTime":1267.38,"endTime":1270.35,"body":"alcohol use, okay, so you're not"},{"speaker":"Patrick","startTime":1267.38,"endTime":1270.35,"body":"saying alcohol use at the same"},{"speaker":"Patrick","startTime":1270.35,"endTime":1273.95,"body":"time, influences depression, so"},{"speaker":"Patrick","startTime":1270.35,"endTime":1273.95,"body":"it's omitted reciprocal"},{"speaker":"Patrick","startTime":1273.95,"endTime":1277.43,"body":"relations are you blown the"},{"speaker":"Patrick","startTime":1273.95,"endTime":1277.43,"body":"causal direction, the other"},{"speaker":"Patrick","startTime":1277.43,"endTime":1280.1,"body":"closely related when you have"},{"speaker":"Patrick","startTime":1277.43,"endTime":1280.1,"body":"omitted variables, right, this"},{"speaker":"Patrick","startTime":1280.1,"endTime":1284.15,"body":"is just old school that you say"},{"speaker":"Patrick","startTime":1280.1,"endTime":1284.15,"body":"depression predicts alcohol use,"},{"speaker":"Patrick","startTime":1284.15,"endTime":1287.36,"body":"but you've actually have a"},{"speaker":"Patrick","startTime":1284.15,"endTime":1287.36,"body":"fundamental causal predictor."},{"speaker":"Patrick","startTime":1287.51,"endTime":1290.54,"body":"And this goes back to Gauss"},{"speaker":"Patrick","startTime":1287.51,"endTime":1290.54,"body":"Markov, who gave the less than"},{"speaker":"Patrick","startTime":1290.54,"endTime":1294.68,"body":"helpful guidance that the"},{"speaker":"Patrick","startTime":1290.54,"endTime":1294.68,"body":"important variables are included"},{"speaker":"Patrick","startTime":1294.68,"endTime":1298.28,"body":"and unimportant or excluded."},{"speaker":"Patrick","startTime":1294.68,"endTime":1298.28,"body":"That wasn't their exact wording,"},{"speaker":"Patrick","startTime":1298.28,"endTime":1301.46,"body":"but that's a paraphrasing."},{"speaker":"Patrick","startTime":1298.28,"endTime":1301.46,"body":"Alright, so omitted variables."},{"speaker":"Patrick","startTime":1301.67,"endTime":1304.61,"body":"And then the third one that we"},{"speaker":"Patrick","startTime":1301.67,"endTime":1304.61,"body":"could delve in an entire"},{"speaker":"Patrick","startTime":1304.61,"endTime":1308.03,"body":"episode, and I'm just going to"},{"speaker":"Patrick","startTime":1304.61,"endTime":1308.03,"body":"kind of set aside for now is"},{"speaker":"Patrick","startTime":1308.03,"endTime":1311.75,"body":"that the independent variables"},{"speaker":"Patrick","startTime":1308.03,"endTime":1311.75,"body":"have non random measurement"},{"speaker":"Patrick","startTime":1311.75,"endTime":1315.23,"body":"error that we often assume that"},{"speaker":"Patrick","startTime":1311.75,"endTime":1315.23,"body":"measurement error is random, is"},{"speaker":"Patrick","startTime":1315.23,"endTime":1318.14,"body":"you're just as likely to be"},{"speaker":"Patrick","startTime":1315.23,"endTime":1318.14,"body":"above as below as you step on"},{"speaker":"Patrick","startTime":1318.14,"endTime":1321.44,"body":"and off your crappy scale. But"},{"speaker":"Patrick","startTime":1318.14,"endTime":1321.44,"body":"that it's non random, that"},{"speaker":"Patrick","startTime":1321.44,"endTime":1324.74,"body":"somehow the measurement error on"},{"speaker":"Patrick","startTime":1321.44,"endTime":1324.74,"body":"the predictor is systematically"},{"speaker":"Patrick","startTime":1324.74,"endTime":1326.42,"body":"associated with the dependent"},{"speaker":"Patrick","startTime":1324.74,"endTime":1326.42,"body":"variable"},{"speaker":"Greg","startTime":1326.45,"endTime":1329.03,"body":"for me of the three of"},{"speaker":"Greg","startTime":1326.45,"endTime":1329.03,"body":"those, it's the middle one that"},{"speaker":"Greg","startTime":1329.03,"endTime":1332.69,"body":"I think is the most worrisome on"},{"speaker":"Greg","startTime":1329.03,"endTime":1332.69,"body":"the first one having to do with"},{"speaker":"Greg","startTime":1332.69,"endTime":1335.84,"body":"reciprocal causation, I"},{"speaker":"Greg","startTime":1332.69,"endTime":1335.84,"body":"generally prefer that that be"},{"speaker":"Greg","startTime":1335.84,"endTime":1339.26,"body":"unpacked and not cross"},{"speaker":"Greg","startTime":1335.84,"endTime":1339.26,"body":"sectionally. But longitudinally,"},{"speaker":"Greg","startTime":1339.53,"endTime":1342.89,"body":"so maybe it's possible to do an"},{"speaker":"Greg","startTime":1339.53,"endTime":1342.89,"body":"end run around some of that by"},{"speaker":"Greg","startTime":1342.89,"endTime":1346.13,"body":"modeling it. And then the thing"},{"speaker":"Greg","startTime":1342.89,"endTime":1346.13,"body":"about the non random measurement"},{"speaker":"Greg","startTime":1346.13,"endTime":1349.49,"body":"error, I just want to avoid that"},{"speaker":"Greg","startTime":1346.13,"endTime":1349.49,"body":"here, because it's a lot for us"},{"speaker":"Greg","startTime":1349.49,"endTime":1353.0,"body":"to do. But the whole idea that"},{"speaker":"Greg","startTime":1349.49,"endTime":1353.0,"body":"your model has all the relevant"},{"speaker":"Greg","startTime":1353.0,"endTime":1356.51,"body":"variables on the table, that's a"},{"speaker":"Greg","startTime":1353.0,"endTime":1356.51,"body":"pretty big pill to swallow."},{"speaker":"Greg","startTime":1356.51,"endTime":1358.46,"body":"Right. And so I think that's the"},{"speaker":"Greg","startTime":1356.51,"endTime":1358.46,"body":"main one that that we want to"},{"speaker":"Greg","startTime":1358.46,"endTime":1359.78,"body":"deal with right here. Alright,"},{"speaker":"Greg","startTime":1358.46,"endTime":1359.78,"body":"so"},{"speaker":"Patrick","startTime":1359.78,"endTime":1363.65,"body":"those are the reasons"},{"speaker":"Patrick","startTime":1359.78,"endTime":1363.65,"body":"why we may get this covariance"},{"speaker":"Patrick","startTime":1363.65,"endTime":1367.28,"body":"between your predictor and your"},{"speaker":"Patrick","startTime":1363.65,"endTime":1367.28,"body":"residual. All right, well, you"},{"speaker":"Patrick","startTime":1367.28,"endTime":1371.99,"body":"know, what we're going to bring"},{"speaker":"Patrick","startTime":1367.28,"endTime":1371.99,"body":"indirectly back guinea pigs, ah,"},{"speaker":"Patrick","startTime":1372.02,"endTime":1379.43,"body":"Sewell right path tracing guinea"},{"speaker":"Patrick","startTime":1372.02,"endTime":1379.43,"body":"pigs. His dad was a heavy hitter"},{"speaker":"Patrick","startTime":1379.46,"endTime":1383.18,"body":"in this area in early"},{"speaker":"Patrick","startTime":1379.46,"endTime":1383.18,"body":"developments of what became to"},{"speaker":"Patrick","startTime":1383.18,"endTime":1387.32,"body":"stage least squares, wow, not"},{"speaker":"Patrick","startTime":1383.18,"endTime":1387.32,"body":"suitable, right? But Phillip,"},{"speaker":"Patrick","startTime":1387.32,"endTime":1389.93,"body":"right? I am."},{"speaker":"Patrick","startTime":1397.97,"endTime":1401.75,"body":"And Philip, right, initially"},{"speaker":"Patrick","startTime":1397.97,"endTime":1401.75,"body":"incorporated what was called an"},{"speaker":"Patrick","startTime":1401.78,"endTime":1406.16,"body":"instrument, alright, an"},{"speaker":"Patrick","startTime":1401.78,"endTime":1406.16,"body":"instrumental variable. And this"},{"speaker":"Patrick","startTime":1406.16,"endTime":1409.88,"body":"is the cornerstone to two stage"},{"speaker":"Patrick","startTime":1406.16,"endTime":1409.88,"body":"least squares. So what it is,"},{"speaker":"Patrick","startTime":1409.88,"endTime":1412.61,"body":"is, if you have an X predicting"},{"speaker":"Patrick","startTime":1409.88,"endTime":1412.61,"body":"y, we're going to stay super"},{"speaker":"Patrick","startTime":1412.61,"endTime":1414.95,"body":"simple with just a single"},{"speaker":"Patrick","startTime":1412.61,"endTime":1414.95,"body":"predictor, and all of this"},{"speaker":"Patrick","startTime":1414.95,"endTime":1418.1,"body":"scales up. And instead of the"},{"speaker":"Patrick","startTime":1414.95,"endTime":1418.1,"body":"covariance between X and Y"},{"speaker":"Patrick","startTime":1418.1,"endTime":1421.55,"body":"divided by the variance of x, we"},{"speaker":"Patrick","startTime":1418.1,"endTime":1421.55,"body":"simply scale up to x prime x"},{"speaker":"Patrick","startTime":1421.55,"endTime":1424.55,"body":"inverse x prime y and everything"},{"speaker":"Patrick","startTime":1421.55,"endTime":1424.55,"body":"goes in our usual multiple"},{"speaker":"Patrick","startTime":1424.55,"endTime":1427.43,"body":"regression, it's just easier to"},{"speaker":"Patrick","startTime":1424.55,"endTime":1427.43,"body":"think about for a single"},{"speaker":"Patrick","startTime":1427.43,"endTime":1430.58,"body":"predictor. Alright, so everybody"},{"speaker":"Patrick","startTime":1427.43,"endTime":1430.58,"body":"pay attention, okay, because we"},{"speaker":"Patrick","startTime":1430.58,"endTime":1434.06,"body":"need a quick definition that"},{"speaker":"Patrick","startTime":1430.58,"endTime":1434.06,"body":"there's a lot of confusion about"},{"speaker":"Patrick","startTime":1434.39,"endTime":1439.04,"body":"an instrumental variable is an"},{"speaker":"Patrick","startTime":1434.39,"endTime":1439.04,"body":"additional measure. This is what"},{"speaker":"Patrick","startTime":1439.04,"endTime":1441.95,"body":"you were alluding to with the"},{"speaker":"Patrick","startTime":1439.04,"endTime":1441.95,"body":"omitted variable. This is"},{"speaker":"Patrick","startTime":1441.95,"endTime":1446.6,"body":"bringing in to your x to y"},{"speaker":"Patrick","startTime":1441.95,"endTime":1446.6,"body":"relation, for lack of a better"},{"speaker":"Patrick","startTime":1446.6,"endTime":1450.29,"body":"notation, let's call it Z, we're"},{"speaker":"Patrick","startTime":1446.6,"endTime":1450.29,"body":"going to bring in an external"},{"speaker":"Patrick","startTime":1450.29,"endTime":1455.33,"body":"measured variable that is"},{"speaker":"Patrick","startTime":1450.29,"endTime":1455.33,"body":"uniquely related to x the"},{"speaker":"Patrick","startTime":1455.33,"endTime":1460.28,"body":"problem predictor, but it is not"},{"speaker":"Patrick","startTime":1455.33,"endTime":1460.28,"body":"related to why why it's not a"},{"speaker":"Patrick","startTime":1460.28,"endTime":1464.48,"body":"shocker that this came out of"},{"speaker":"Patrick","startTime":1460.28,"endTime":1464.48,"body":"the Wright family. This is"},{"speaker":"Patrick","startTime":1464.48,"endTime":1467.93,"body":"actually an indirect effect."},{"speaker":"Patrick","startTime":1464.48,"endTime":1467.93,"body":"It's a path model. It's a path"},{"speaker":"Patrick","startTime":1467.93,"endTime":1473.66,"body":"model, we have z predicting X"},{"speaker":"Patrick","startTime":1467.93,"endTime":1473.66,"body":"and X predicting y in this"},{"speaker":"Patrick","startTime":1473.66,"endTime":1475.97,"body":"initial model. Now, we're not"},{"speaker":"Patrick","startTime":1473.66,"endTime":1475.97,"body":"going to actually estimate it"},{"speaker":"Patrick","startTime":1475.97,"endTime":1478.94,"body":"that way. What we're going to"},{"speaker":"Patrick","startTime":1475.97,"endTime":1478.94,"body":"do, are you ready for this? This"},{"speaker":"Patrick","startTime":1478.94,"endTime":1483.8,"body":"is the spinning hook kick from"},{"speaker":"Patrick","startTime":1478.94,"endTime":1483.8,"body":"least squares. If you have an"},{"speaker":"Patrick","startTime":1483.8,"endTime":1487.13,"body":"instrumental variable that is"},{"speaker":"Patrick","startTime":1483.8,"endTime":1487.13,"body":"related to x, but not related to"},{"speaker":"Patrick","startTime":1487.13,"endTime":1492.83,"body":"y, in stage one, we're going to"},{"speaker":"Patrick","startTime":1487.13,"endTime":1492.83,"body":"use Z to predict X and we're"},{"speaker":"Patrick","startTime":1492.83,"endTime":1497.57,"body":"going to save out the predicted"},{"speaker":"Patrick","startTime":1492.83,"endTime":1497.57,"body":"values x hat, okay. Now it's"},{"speaker":"Patrick","startTime":1497.57,"endTime":1499.76,"body":"important we're not saving up"},{"speaker":"Patrick","startTime":1497.57,"endTime":1499.76,"body":"the residuals that actually"},{"speaker":"Patrick","startTime":1499.76,"endTime":1503.33,"body":"under So the whole thing, we're"},{"speaker":"Patrick","startTime":1499.76,"endTime":1503.33,"body":"getting x hat, that's stage one,"},{"speaker":"Patrick","startTime":1503.45,"endTime":1509.78,"body":"okay? Stage two is instead of"},{"speaker":"Patrick","startTime":1503.45,"endTime":1509.78,"body":"using x to predict y, we use x"},{"speaker":"Patrick","startTime":1509.78,"endTime":1515.42,"body":"hat to predict y. That's the"},{"speaker":"Patrick","startTime":1509.78,"endTime":1515.42,"body":"second stage that removes that"},{"speaker":"Patrick","startTime":1515.42,"endTime":1518.84,"body":"relation between x and the"},{"speaker":"Patrick","startTime":1515.42,"endTime":1518.84,"body":"residual. And when assumptions"},{"speaker":"Patrick","startTime":1518.84,"endTime":1522.92,"body":"are met that x hat to y"},{"speaker":"Patrick","startTime":1518.84,"endTime":1522.92,"body":"regression coefficient gamma"},{"speaker":"Patrick","startTime":1523.04,"endTime":1526.55,"body":"that is unbiased. And that"},{"speaker":"Patrick","startTime":1523.04,"endTime":1526.55,"body":"addresses that endogeneity"},{"speaker":"Patrick","startTime":1526.55,"endTime":1530.9,"body":"problem. It's very clever. Oh,"},{"speaker":"Patrick","startTime":1526.55,"endTime":1530.9,"body":"it's clever as hell, the biased"},{"speaker":"Patrick","startTime":1530.9,"endTime":1534.71,"body":"regression coefficient is"},{"speaker":"Patrick","startTime":1530.9,"endTime":1534.71,"body":"facedown on the mat saying What"},{"speaker":"Patrick","startTime":1534.71,"endTime":1540.2,"body":"in God's name just happened. My"},{"speaker":"Patrick","startTime":1534.71,"endTime":1540.2,"body":"final competitive fight, I was"},{"speaker":"Patrick","startTime":1540.2,"endTime":1544.1,"body":"very fortunate. I made it to the"},{"speaker":"Patrick","startTime":1540.2,"endTime":1544.1,"body":"finals. I survived a couple of"},{"speaker":"Patrick","startTime":1544.1,"endTime":1548.45,"body":"minutes. And at one point, I"},{"speaker":"Patrick","startTime":1544.1,"endTime":1548.45,"body":"found myself on my hands and"},{"speaker":"Patrick","startTime":1548.45,"endTime":1553.34,"body":"knees. The ref was counting to"},{"speaker":"Patrick","startTime":1548.45,"endTime":1553.34,"body":"10. My coach was screaming at me"},{"speaker":"Patrick","startTime":1553.34,"endTime":1559.73,"body":"to get up. And my only thought I"},{"speaker":"Patrick","startTime":1553.34,"endTime":1559.73,"body":"had was I never saw it. And that"},{"speaker":"Patrick","startTime":1559.73,"endTime":1565.52,"body":"was my last competitive fight."},{"speaker":"Patrick","startTime":1559.73,"endTime":1565.52,"body":"So gamma is facedown on the map."},{"speaker":"Patrick","startTime":1565.58,"endTime":1570.65,"body":"No, that was 1928. That right"},{"speaker":"Patrick","startTime":1565.58,"endTime":1570.65,"body":"was writing about this. All"},{"speaker":"Patrick","startTime":1570.65,"endTime":1573.71,"body":"right. And he developed this"},{"speaker":"Patrick","startTime":1570.65,"endTime":1573.71,"body":"stuff in the teens and early"},{"speaker":"Patrick","startTime":1573.71,"endTime":1578.66,"body":"20s. People picked it up in the"},{"speaker":"Patrick","startTime":1573.71,"endTime":1578.66,"body":"1940s. And then big people who"},{"speaker":"Patrick","startTime":1578.66,"endTime":1584.9,"body":"are identified with this as"},{"speaker":"Patrick","startTime":1578.66,"endTime":1584.9,"body":"baseman in 1957. Thiel in 1971."},{"speaker":"Patrick","startTime":1585.14,"endTime":1588.14,"body":"So what Wright was trying to do,"},{"speaker":"Patrick","startTime":1585.14,"endTime":1588.14,"body":"and this is another great"},{"speaker":"Patrick","startTime":1588.14,"endTime":1591.11,"body":"example of having a substantive"},{"speaker":"Patrick","startTime":1588.14,"endTime":1591.11,"body":"problem that just needed a"},{"speaker":"Patrick","startTime":1591.11,"endTime":1596.99,"body":"solution. Right, I was trying to"},{"speaker":"Patrick","startTime":1591.11,"endTime":1596.99,"body":"understand a supply demand curve"},{"speaker":"Patrick","startTime":1596.99,"endTime":1601.61,"body":"for butter. All right, so this"},{"speaker":"Patrick","startTime":1596.99,"endTime":1601.61,"body":"is back in the 1920s. He was an"},{"speaker":"Patrick","startTime":1601.61,"endTime":1604.46,"body":"econometrician and he wanted a"},{"speaker":"Patrick","startTime":1601.61,"endTime":1604.46,"body":"supply demand curve. And he"},{"speaker":"Patrick","startTime":1604.46,"endTime":1608.57,"body":"wanted to use regression to get"},{"speaker":"Patrick","startTime":1604.46,"endTime":1608.57,"body":"that. And the problem was there"},{"speaker":"Patrick","startTime":1608.57,"endTime":1612.14,"body":"was reciprocal relation between"},{"speaker":"Patrick","startTime":1608.57,"endTime":1612.14,"body":"supply and demand. So you have"},{"speaker":"Patrick","startTime":1612.14,"endTime":1617.21,"body":"this endogeneity problem. But he"},{"speaker":"Patrick","startTime":1612.14,"endTime":1617.21,"body":"went out to find an instrumental"},{"speaker":"Patrick","startTime":1617.21,"endTime":1621.8,"body":"variable, and he selected amount"},{"speaker":"Patrick","startTime":1617.21,"endTime":1621.8,"body":"of rainfall as the instrumental"},{"speaker":"Patrick","startTime":1621.8,"endTime":1624.53,"body":"variable. Right? Well think"},{"speaker":"Patrick","startTime":1621.8,"endTime":1624.53,"body":"about it, because a lot of this"},{"speaker":"Patrick","startTime":1624.53,"endTime":1627.56,"body":"stuff that's so fun is, well,"},{"speaker":"Patrick","startTime":1624.53,"endTime":1627.56,"body":"what is an instrumental"},{"speaker":"Patrick","startTime":1627.56,"endTime":1630.05,"body":"variable? How do you determine"},{"speaker":"Patrick","startTime":1627.56,"endTime":1630.05,"body":"what an instrumental variable"},{"speaker":"Patrick","startTime":1630.05,"endTime":1630.26,"body":"is?"},{"speaker":"Greg","startTime":1630.29,"endTime":1632.06,"body":"How do you find it in the"},{"speaker":"Greg","startTime":1630.29,"endTime":1632.06,"body":"wild, right?"},{"speaker":"Patrick","startTime":1632.09,"endTime":1634.34,"body":"Well, not only how do"},{"speaker":"Patrick","startTime":1632.09,"endTime":1634.34,"body":"you find it in the wild, but how"},{"speaker":"Patrick","startTime":1634.34,"endTime":1636.95,"body":"do you pick one even"},{"speaker":"Patrick","startTime":1634.34,"endTime":1636.95,"body":"conceptually, that would be"},{"speaker":"Patrick","startTime":1636.95,"endTime":1639.8,"body":"related to the predictor, but"},{"speaker":"Patrick","startTime":1636.95,"endTime":1639.8,"body":"not the outcome. Think about the"},{"speaker":"Patrick","startTime":1639.8,"endTime":1644.93,"body":"logical syllogism his thinking"},{"speaker":"Patrick","startTime":1639.8,"endTime":1644.93,"body":"was, rainfall is related to"},{"speaker":"Patrick","startTime":1644.96,"endTime":1650.09,"body":"grass growth, grass growth is"},{"speaker":"Patrick","startTime":1644.96,"endTime":1650.09,"body":"related to milk production, milk"},{"speaker":"Patrick","startTime":1650.09,"endTime":1655.19,"body":"production is related to butter"},{"speaker":"Patrick","startTime":1650.09,"endTime":1655.19,"body":"production. And so rainfall is"},{"speaker":"Patrick","startTime":1655.19,"endTime":1659.72,"body":"related to the supply of butter,"},{"speaker":"Patrick","startTime":1655.19,"endTime":1659.72,"body":"but it's not related to the"},{"speaker":"Patrick","startTime":1659.72,"endTime":1665.27,"body":"demand for butter, you can make"},{"speaker":"Patrick","startTime":1659.72,"endTime":1665.27,"body":"a reasonable argument that you"},{"speaker":"Patrick","startTime":1665.33,"endTime":1667.85,"body":"aren't more likely to buy butter"},{"speaker":"Patrick","startTime":1665.33,"endTime":1667.85,"body":"if it's raining."},{"speaker":"Greg","startTime":1667.91,"endTime":1671.06,"body":"Oh, come on, in out of the"},{"speaker":"Greg","startTime":1667.91,"endTime":1671.06,"body":"rain Kids, let's have a snack"},{"speaker":"Greg","startTime":1671.09,"endTime":1672.47,"body":"who wants a fresh stick of"},{"speaker":"Greg","startTime":1671.09,"endTime":1672.47,"body":"butter."},{"speaker":"Patrick","startTime":1674.3,"endTime":1678.68,"body":"But isn't that clever,"},{"speaker":"Patrick","startTime":1674.3,"endTime":1678.68,"body":"very clever. Rainfall is used as"},{"speaker":"Patrick","startTime":1678.68,"endTime":1682.16,"body":"an instrumental variable for"},{"speaker":"Patrick","startTime":1678.68,"endTime":1682.16,"body":"supply, he was able to address"},{"speaker":"Patrick","startTime":1682.16,"endTime":1685.97,"body":"the endogeneity. And he was able"},{"speaker":"Patrick","startTime":1682.16,"endTime":1685.97,"body":"to achieve what he was trying to"},{"speaker":"Patrick","startTime":1685.97,"endTime":1689.66,"body":"do with the supply demand curve."},{"speaker":"Patrick","startTime":1685.97,"endTime":1689.66,"body":"These scale up their whole"},{"speaker":"Patrick","startTime":1689.66,"endTime":1692.72,"body":"decades of work on this, we're"},{"speaker":"Patrick","startTime":1689.66,"endTime":1692.72,"body":"not going to belabor this. But"},{"speaker":"Patrick","startTime":1692.72,"endTime":1697.46,"body":"this is kind of a workhorse in"},{"speaker":"Patrick","startTime":1692.72,"endTime":1697.46,"body":"econometrics. Also in fields"},{"speaker":"Patrick","startTime":1697.46,"endTime":1700.49,"body":"like sociology, where these"},{"speaker":"Patrick","startTime":1697.46,"endTime":1700.49,"body":"things come up, there's a"},{"speaker":"Patrick","startTime":1700.49,"endTime":1705.68,"body":"wonderful paper in 1978 that"},{"speaker":"Patrick","startTime":1700.49,"endTime":1705.68,"body":"introduces two stage least"},{"speaker":"Patrick","startTime":1705.68,"endTime":1710.15,"body":"squares to psychological"},{"speaker":"Patrick","startTime":1705.68,"endTime":1710.15,"body":"researchers. Notice we haven't"},{"speaker":"Patrick","startTime":1710.15,"endTime":1714.14,"body":"even gotten to the SEM, this is"},{"speaker":"Patrick","startTime":1710.15,"endTime":1714.14,"body":"our Wayback Machine. This is"},{"speaker":"Patrick","startTime":1714.14,"endTime":1718.19,"body":"realizing Holy crap. Least"},{"speaker":"Patrick","startTime":1714.14,"endTime":1718.19,"body":"Squares has a spinning hook."},{"speaker":"Greg","startTime":1719.09,"endTime":1721.4,"body":"What I like and don't like"},{"speaker":"Greg","startTime":1719.09,"endTime":1721.4,"body":"about that is that information"},{"speaker":"Greg","startTime":1721.4,"endTime":1723.77,"body":"had been sitting around for a"},{"speaker":"Greg","startTime":1721.4,"endTime":1723.77,"body":"long time, right? But in the"},{"speaker":"Greg","startTime":1723.77,"endTime":1727.55,"body":"econometrics world, and then"},{"speaker":"Greg","startTime":1723.77,"endTime":1727.55,"body":"it's being ported over into the"},{"speaker":"Greg","startTime":1727.55,"endTime":1730.82,"body":"social sciences, like Hey, Guys,"},{"speaker":"Greg","startTime":1727.55,"endTime":1730.82,"body":"wake up, this thing exists over"},{"speaker":"Greg","startTime":1730.82,"endTime":1733.76,"body":"there, the same thing was true"},{"speaker":"Greg","startTime":1730.82,"endTime":1733.76,"body":"of his son's work, a lot of the"},{"speaker":"Greg","startTime":1733.76,"endTime":1736.64,"body":"path analysis stuff that didn't"},{"speaker":"Greg","startTime":1733.76,"endTime":1736.64,"body":"start finding its way into"},{"speaker":"Greg","startTime":1736.64,"endTime":1741.02,"body":"sociology, and the other, the"},{"speaker":"Greg","startTime":1736.64,"endTime":1741.02,"body":"other ologies until the 60s and"},{"speaker":"Greg","startTime":1741.02,"endTime":1744.77,"body":"70s. So we're finally getting"},{"speaker":"Greg","startTime":1741.02,"endTime":1744.77,"body":"some of the cool things that"},{"speaker":"Greg","startTime":1744.77,"endTime":1747.14,"body":"were going on there. But"},{"speaker":"Greg","startTime":1744.77,"endTime":1747.14,"body":"actually, there are things over"},{"speaker":"Greg","startTime":1747.14,"endTime":1750.98,"body":"in that world that has ignored"},{"speaker":"Greg","startTime":1747.14,"endTime":1750.98,"body":"stuff that we have, right in our"},{"speaker":"Greg","startTime":1750.98,"endTime":1753.83,"body":"world, we talk a ton about"},{"speaker":"Greg","startTime":1750.98,"endTime":1753.83,"body":"measurement error and latent"},{"speaker":"Greg","startTime":1753.83,"endTime":1757.22,"body":"variables. And most of the"},{"speaker":"Greg","startTime":1753.83,"endTime":1757.22,"body":"examples that I see from the"},{"speaker":"Greg","startTime":1757.22,"endTime":1760.46,"body":"econometrics world deals with"},{"speaker":"Greg","startTime":1757.22,"endTime":1760.46,"body":"things that are measured. And so"},{"speaker":"Greg","startTime":1760.46,"endTime":1764.84,"body":"it feels like there is this"},{"speaker":"Greg","startTime":1760.46,"endTime":1764.84,"body":"union waiting to happen between"},{"speaker":"Greg","startTime":1764.84,"endTime":1768.26,"body":"the information that we have in"},{"speaker":"Greg","startTime":1764.84,"endTime":1768.26,"body":"our world about dealing with"},{"speaker":"Greg","startTime":1768.26,"endTime":1771.62,"body":"things that are fuzzy that have"},{"speaker":"Greg","startTime":1768.26,"endTime":1771.62,"body":"measurement error, and their"},{"speaker":"Greg","startTime":1771.62,"endTime":1774.92,"body":"world about having instrumental"},{"speaker":"Greg","startTime":1771.62,"endTime":1774.92,"body":"variables. Getting all those in"},{"speaker":"Greg","startTime":1774.92,"endTime":1778.91,"body":"the same place seems like it"},{"speaker":"Greg","startTime":1774.92,"endTime":1778.91,"body":"would do 180% of the work or"},{"speaker":"Greg","startTime":1778.91,"endTime":1780.38,"body":"something right, that it"},{"speaker":"Greg","startTime":1778.91,"endTime":1780.38,"body":"wouldn't be able to come"},{"speaker":"Greg","startTime":1780.38,"endTime":1782.81,"body":"together to be more than the sum"},{"speaker":"Greg","startTime":1780.38,"endTime":1782.81,"body":"of its parts"},{"speaker":"Patrick","startTime":1783.02,"endTime":1788.24,"body":"joining. Together, we"},{"speaker":"Patrick","startTime":1783.02,"endTime":1788.24,"body":"can move a galaxy. So I think"},{"speaker":"Patrick","startTime":1788.24,"endTime":1792.05,"body":"there are two points at least"},{"speaker":"Patrick","startTime":1788.24,"endTime":1792.05,"body":"I'd like to distill down to and"},{"speaker":"Patrick","startTime":1792.08,"endTime":1795.65,"body":"what we've talked about thus far"},{"speaker":"Patrick","startTime":1792.08,"endTime":1795.65,"body":"is first, if you teach"},{"speaker":"Patrick","startTime":1795.65,"endTime":1799.25,"body":"regression if you apply"},{"speaker":"Patrick","startTime":1795.65,"endTime":1799.25,"body":"regression in your own kind of"},{"speaker":"Patrick","startTime":1799.25,"endTime":1803.42,"body":"work This is something really"},{"speaker":"Patrick","startTime":1799.25,"endTime":1803.42,"body":"important to think about. If you"},{"speaker":"Patrick","startTime":1803.42,"endTime":1806.66,"body":"have reciprocal relation, if you"},{"speaker":"Patrick","startTime":1803.42,"endTime":1806.66,"body":"have omitted variables, if you"},{"speaker":"Patrick","startTime":1806.66,"endTime":1809.84,"body":"have this non random measurement"},{"speaker":"Patrick","startTime":1806.66,"endTime":1809.84,"body":"error, this is big ticket stuff"},{"speaker":"Patrick","startTime":1809.84,"endTime":1815.18,"body":"and you get bias. So one is know"},{"speaker":"Patrick","startTime":1809.84,"endTime":1815.18,"body":"this exists to remember least"},{"speaker":"Patrick","startTime":1815.18,"endTime":1818.84,"body":"squares has a spinning hook"},{"speaker":"Patrick","startTime":1815.18,"endTime":1818.84,"body":"kick, so stay the heck out of"},{"speaker":"Patrick","startTime":1818.87,"endTime":1822.71,"body":"its range, right? You and I were"},{"speaker":"Patrick","startTime":1818.87,"endTime":1822.71,"body":"messing around once a number of"},{"speaker":"Patrick","startTime":1822.71,"endTime":1825.74,"body":"years ago, because you're a"},{"speaker":"Patrick","startTime":1822.71,"endTime":1825.74,"body":"black belt in Judo, which for"},{"speaker":"Patrick","startTime":1825.74,"endTime":1829.67,"body":"people who don't know, is"},{"speaker":"Patrick","startTime":1825.74,"endTime":1829.67,"body":"primarily a grappling defense."},{"speaker":"Patrick","startTime":1829.97,"endTime":1834.95,"body":"My training is in taekwondo,"},{"speaker":"Patrick","startTime":1829.97,"endTime":1834.95,"body":"which is primarily kicking my"},{"speaker":"Patrick","startTime":1834.95,"endTime":1839.87,"body":"zone of comfort is about eight"},{"speaker":"Patrick","startTime":1834.95,"endTime":1839.87,"body":"feet away from you. And you and"},{"speaker":"Patrick","startTime":1839.87,"endTime":1843.65,"body":"I were kind of messing around in"},{"speaker":"Patrick","startTime":1839.87,"endTime":1843.65,"body":"the backyard sparring, and you"},{"speaker":"Patrick","startTime":1843.65,"endTime":1847.85,"body":"kept coming in and, like"},{"speaker":"Patrick","startTime":1843.65,"endTime":1847.85,"body":"touching me, and I'm like, dude,"},{"speaker":"Patrick","startTime":1848.33,"endTime":1853.46,"body":"back up. I can't kick you. If"},{"speaker":"Patrick","startTime":1848.33,"endTime":1853.46,"body":"you're spinning me over your"},{"speaker":"Patrick","startTime":1853.46,"endTime":1854.51,"body":"head like this."},{"speaker":"Greg","startTime":1854.57,"endTime":1857.87,"body":"Could you please back up"},{"speaker":"Greg","startTime":1854.57,"endTime":1857.87,"body":"so I may kick you I was very"},{"speaker":"Patrick","startTime":1857.87,"endTime":1862.16,"body":"polite about it. Okay,"},{"speaker":"Patrick","startTime":1857.87,"endTime":1862.16,"body":"point being recognize these"},{"speaker":"Patrick","startTime":1862.16,"endTime":1865.88,"body":"problems exist recognize that"},{"speaker":"Patrick","startTime":1862.16,"endTime":1865.88,"body":"there are approaches that can"},{"speaker":"Patrick","startTime":1865.88,"endTime":1870.71,"body":"handle it. Respect least squares"},{"speaker":"Patrick","startTime":1865.88,"endTime":1870.71,"body":"has a spinning hook kick, butt"},{"speaker":"Patrick","startTime":1870.71,"endTime":1874.4,"body":"where we're going to pivot now"},{"speaker":"Patrick","startTime":1870.71,"endTime":1874.4,"body":"is Boland woke up one morning"},{"speaker":"Patrick","startTime":1874.4,"endTime":1878.9,"body":"and said, Oh, damn, I got an"},{"speaker":"Patrick","startTime":1874.4,"endTime":1878.9,"body":"idea. And that's where we're"},{"speaker":"Patrick","startTime":1878.9,"endTime":1882.95,"body":"going to go into two stage least"},{"speaker":"Patrick","startTime":1878.9,"endTime":1882.95,"body":"squares for SEO. But first, I"},{"speaker":"Patrick","startTime":1882.95,"endTime":1898.97,"body":"have to go to the bathroom."},{"speaker":"Patrick","startTime":1882.95,"endTime":1898.97,"body":"Okay. Okay, I'm back."},{"speaker":"Greg","startTime":1899.0,"endTime":1901.1,"body":"So now that you're about"},{"speaker":"Greg","startTime":1899.0,"endTime":1901.1,"body":"14 ounces lighter."},{"speaker":"Patrick","startTime":1902.18,"endTime":1905.69,"body":"So at some point, I get"},{"speaker":"Patrick","startTime":1902.18,"endTime":1905.69,"body":"tired of talking about bowling."},{"speaker":"Patrick","startTime":1906.8,"endTime":1910.88,"body":"Right? It's like bowling this"},{"speaker":"Patrick","startTime":1906.8,"endTime":1910.88,"body":"bowling that. And you know what"},{"speaker":"Patrick","startTime":1910.88,"endTime":1915.74,"body":"particularly pisses me off with"},{"speaker":"Patrick","startTime":1910.88,"endTime":1915.74,"body":"him. He is so hard to dislike."},{"speaker":"Patrick","startTime":1916.37,"endTime":1921.86,"body":"He is a decent human being. He"},{"speaker":"Patrick","startTime":1916.37,"endTime":1921.86,"body":"is kind. He is supportive. He is"},{"speaker":"Patrick","startTime":1921.86,"endTime":1926.66,"body":"enthusiastic. He's in the game"},{"speaker":"Patrick","startTime":1921.86,"endTime":1926.66,"body":"for the love of the game. And so"},{"speaker":"Patrick","startTime":1926.66,"endTime":1931.28,"body":"when you have somebody who has"},{"speaker":"Patrick","startTime":1926.66,"endTime":1931.28,"body":"done so much for the field, you"},{"speaker":"Patrick","startTime":1931.28,"endTime":1933.68,"body":"really want to dislike them. Oh,"},{"speaker":"Patrick","startTime":1931.28,"endTime":1933.68,"body":"and he"},{"speaker":"Greg","startTime":1933.68,"endTime":1937.22,"body":"seen Jimi Hendrix in"},{"speaker":"Greg","startTime":1933.68,"endTime":1937.22,"body":"concert? No way he has. Yeah, he"},{"speaker":"Greg","startTime":1937.22,"endTime":1937.7,"body":"told me about"},{"speaker":"Patrick","startTime":1937.7,"endTime":1939.26,"body":"it. I did not know"},{"speaker":"Patrick","startTime":1937.7,"endTime":1939.26,"body":"that."},{"speaker":"Patrick","startTime":1946.53,"endTime":1949.29,"body":"Yeah, how do you top that?"},{"speaker":"Patrick","startTime":1946.53,"endTime":1949.29,"body":"That's pretty cool. Alright, in"},{"speaker":"Patrick","startTime":1949.29,"endTime":1954.39,"body":"the early 90s Ken, who is a card"},{"speaker":"Patrick","startTime":1949.29,"endTime":1954.39,"body":"carrying sociologist and trained"},{"speaker":"Patrick","startTime":1954.39,"endTime":1957.87,"body":"in demography and coming up"},{"speaker":"Patrick","startTime":1954.39,"endTime":1957.87,"body":"through that substantive lens"},{"speaker":"Patrick","startTime":1958.32,"endTime":1961.8,"body":"was fully aware of two stage"},{"speaker":"Patrick","startTime":1958.32,"endTime":1961.8,"body":"least squares and all that it"},{"speaker":"Patrick","startTime":1961.8,"endTime":1966.54,"body":"had to offer. But one morning he"},{"speaker":"Patrick","startTime":1961.8,"endTime":1966.54,"body":"woke up he had this incredibly"},{"speaker":"Patrick","startTime":1966.54,"endTime":1970.08,"body":"clever idea that you could take"},{"speaker":"Patrick","startTime":1966.54,"endTime":1970.08,"body":"that two stage least squares"},{"speaker":"Patrick","startTime":1970.08,"endTime":1973.92,"body":"method and apply it within the"},{"speaker":"Patrick","startTime":1970.08,"endTime":1973.92,"body":"SEM. Alright, so we're gonna put"},{"speaker":"Patrick","startTime":1973.92,"endTime":1979.11,"body":"all of these citations on the"},{"speaker":"Patrick","startTime":1973.92,"endTime":1979.11,"body":"show notes. He has a 1995 paper"},{"speaker":"Patrick","startTime":1979.11,"endTime":1983.82,"body":"where he Telegraph's this, but"},{"speaker":"Patrick","startTime":1979.11,"endTime":1983.82,"body":"he has a 1996 paper that was"},{"speaker":"Patrick","startTime":1983.82,"endTime":1986.1,"body":"really hitting the first ball"},{"speaker":"Patrick","startTime":1983.82,"endTime":1986.1,"body":"into play, it was in"},{"speaker":"Patrick","startTime":1986.1,"endTime":1989.46,"body":"psychometrics. And it's called"},{"speaker":"Patrick","startTime":1986.1,"endTime":1989.46,"body":"an alternative to stage least"},{"speaker":"Patrick","startTime":1989.46,"endTime":1992.94,"body":"squares estimator for latent"},{"speaker":"Patrick","startTime":1989.46,"endTime":1992.94,"body":"variable equations. And it's a"},{"speaker":"Patrick","startTime":1992.94,"endTime":1995.82,"body":"wonderfully written very"},{"speaker":"Patrick","startTime":1992.94,"endTime":1995.82,"body":"accessible especially for"},{"speaker":"Patrick","startTime":1995.82,"endTime":2000.02,"body":"psychometric a very accessible"},{"speaker":"Patrick","startTime":1995.82,"endTime":2000.02,"body":"paper. He has written I haven't"},{"speaker":"Patrick","startTime":2000.02,"endTime":2005.18,"body":"counted but maybe a dozen papers"},{"speaker":"Patrick","startTime":2000.02,"endTime":2005.18,"body":"that have contributed. He and"},{"speaker":"Patrick","startTime":2005.24,"endTime":2009.86,"body":"Albert may do Olivares did one"},{"speaker":"Patrick","startTime":2005.24,"endTime":2009.86,"body":"for Pollack, Oryx, he and I did"},{"speaker":"Patrick","startTime":2009.86,"endTime":2013.43,"body":"a few with our research group"},{"speaker":"Patrick","startTime":2009.86,"endTime":2013.43,"body":"and looking at simulations of"},{"speaker":"Patrick","startTime":2013.43,"endTime":2017.3,"body":"robustness and applications"},{"speaker":"Patrick","startTime":2013.43,"endTime":2017.3,"body":"comparing to ml. But what's"},{"speaker":"Patrick","startTime":2017.3,"endTime":2021.02,"body":"really neat is he's got a couple"},{"speaker":"Patrick","startTime":2017.3,"endTime":2021.02,"body":"of very recent ones that I would"},{"speaker":"Patrick","startTime":2021.02,"endTime":2025.79,"body":"highly recommend. One is 2017"},{"speaker":"Patrick","startTime":2021.02,"endTime":2025.79,"body":"and multivariate behavioral"},{"speaker":"Patrick","startTime":2025.79,"endTime":2029.78,"body":"research, which gives an"},{"speaker":"Patrick","startTime":2025.79,"endTime":2029.78,"body":"overview of this, and then a"},{"speaker":"Patrick","startTime":2029.78,"endTime":2034.37,"body":"2021 that he wrote with a number"},{"speaker":"Patrick","startTime":2029.78,"endTime":2034.37,"body":"of his colleagues and students"},{"speaker":"Patrick","startTime":2034.4,"endTime":2039.17,"body":"that's in psychological methods."},{"speaker":"Patrick","startTime":2034.4,"endTime":2039.17,"body":"And this is it takes a village"},{"speaker":"Patrick","startTime":2039.17,"endTime":2042.29,"body":"kind of thing is Zach Fisher,"},{"speaker":"Patrick","startTime":2039.17,"endTime":2042.29,"body":"and we will talk about Zach's"},{"speaker":"Patrick","startTime":2042.29,"endTime":2045.47,"body":"work in a minute. He was a grad"},{"speaker":"Patrick","startTime":2042.29,"endTime":2045.47,"body":"student here at Carolina worked"},{"speaker":"Patrick","startTime":2045.47,"endTime":2048.98,"body":"with Ken is now an assistant"},{"speaker":"Patrick","startTime":2045.47,"endTime":2048.98,"body":"professor at Penn State. Zach"},{"speaker":"Patrick","startTime":2048.98,"endTime":2052.73,"body":"has written packages in order"},{"speaker":"Patrick","startTime":2048.98,"endTime":2052.73,"body":"that automate a lot of this"},{"speaker":"Patrick","startTime":2052.73,"endTime":2056.6,"body":"stuff. Michael Shear Dano also a"},{"speaker":"Patrick","startTime":2052.73,"endTime":2056.6,"body":"grad student, Adam Lilly,"},{"speaker":"Patrick","startTime":2056.78,"endTime":2060.56,"body":"Llandeilo IEA, that's in the"},{"speaker":"Patrick","startTime":2056.78,"endTime":2060.56,"body":"psych method. So I highly"},{"speaker":"Patrick","startTime":2060.56,"endTime":2064.25,"body":"recommend these. Let's pan back"},{"speaker":"Patrick","startTime":2060.56,"endTime":2064.25,"body":"a bit. All right, we could do"},{"speaker":"Patrick","startTime":2064.31,"endTime":2067.82,"body":"and I'm not exaggerating, we"},{"speaker":"Patrick","startTime":2064.31,"endTime":2067.82,"body":"could do a graduate level course"},{"speaker":"Patrick","startTime":2067.82,"endTime":2070.76,"body":"in two stage least squares"},{"speaker":"Patrick","startTime":2067.82,"endTime":2070.76,"body":"estimation and all that's"},{"speaker":"Patrick","startTime":2070.76,"endTime":2072.62,"body":"involved with that. We're not"},{"speaker":"Patrick","startTime":2070.76,"endTime":2072.62,"body":"going to do that here. This is"},{"speaker":"Patrick","startTime":2072.62,"endTime":2076.58,"body":"the 30,000 foot. The pilot says"},{"speaker":"Patrick","startTime":2072.62,"endTime":2076.58,"body":"if you're sitting on the left"},{"speaker":"Patrick","startTime":2076.58,"endTime":2080.09,"body":"side and you never are right,"},{"speaker":"Patrick","startTime":2076.58,"endTime":2080.09,"body":"you're always on the right side."},{"speaker":"Patrick","startTime":2080.3,"endTime":2082.79,"body":"If you're sitting on the left"},{"speaker":"Patrick","startTime":2080.3,"endTime":2082.79,"body":"side, you can see the Grand"},{"speaker":"Patrick","startTime":2082.79,"endTime":2087.65,"body":"Canyon. If you're sitting on the"},{"speaker":"Patrick","startTime":2082.79,"endTime":2087.65,"body":"left side, you can see two stage"},{"speaker":"Patrick","startTime":2087.65,"endTime":2093.14,"body":"least squares that can be"},{"speaker":"Patrick","startTime":2087.65,"endTime":2093.14,"body":"applied to FCM. That's what"},{"speaker":"Patrick","startTime":2093.14,"endTime":2096.68,"body":"we're gonna do here. What he"},{"speaker":"Patrick","startTime":2093.14,"endTime":2096.68,"body":"does, and he's a wonderful his"},{"speaker":"Patrick","startTime":2096.68,"endTime":2100.76,"body":"2017. I had read it before, but"},{"speaker":"Patrick","startTime":2096.68,"endTime":2100.76,"body":"I reviewed it again. Last night,"},{"speaker":"Patrick","startTime":2101.0,"endTime":2106.43,"body":"his opening line I love this is"},{"speaker":"Patrick","startTime":2101.0,"endTime":2106.43,"body":"universal agreement is a rarity"},{"speaker":"Patrick","startTime":2106.43,"endTime":2109.82,"body":"in life. Isn't that a great"},{"speaker":"Patrick","startTime":2106.43,"endTime":2109.82,"body":"hook?"},{"speaker":"Greg","startTime":2109.94,"endTime":2110.93,"body":"That is awesome."},{"speaker":"Patrick","startTime":2110.98,"endTime":2114.64,"body":"The second sentence is,"},{"speaker":"Patrick","startTime":2110.98,"endTime":2114.64,"body":"and so it is among scholars"},{"speaker":"Patrick","startTime":2114.64,"endTime":2118.18,"body":"using structural equation"},{"speaker":"Patrick","startTime":2114.64,"endTime":2118.18,"body":"models. Okay, if that does not"},{"speaker":"Patrick","startTime":2118.18,"endTime":2121.09,"body":"hook you in reading the paper"},{"speaker":"Patrick","startTime":2118.18,"endTime":2121.09,"body":"than there's something wrong"},{"speaker":"Patrick","startTime":2121.09,"endTime":2125.65,"body":"with you, I think that's a great"},{"speaker":"Patrick","startTime":2121.09,"endTime":2125.65,"body":"opening. And he goes in, and he"},{"speaker":"Patrick","startTime":2125.68,"endTime":2129.28,"body":"trumpets the advantages of"},{"speaker":"Patrick","startTime":2125.68,"endTime":2129.28,"body":"maximum likelihood it's full"},{"speaker":"Patrick","startTime":2129.28,"endTime":2133.06,"body":"information. It's simultaneous"},{"speaker":"Patrick","startTime":2129.28,"endTime":2133.06,"body":"estimation. It's asymptotically,"},{"speaker":"Patrick","startTime":2133.09,"endTime":2137.23,"body":"unbiased, consistent, efficient,"},{"speaker":"Patrick","startTime":2133.09,"endTime":2137.23,"body":"normal distribution, there is no"},{"speaker":"Patrick","startTime":2137.23,"endTime":2141.94,"body":"better game in town. Unless you"},{"speaker":"Patrick","startTime":2137.23,"endTime":2141.94,"body":"have smaller sample sizes. You"},{"speaker":"Patrick","startTime":2141.94,"endTime":2145.75,"body":"violate normality. And your"},{"speaker":"Patrick","startTime":2141.94,"endTime":2145.75,"body":"model is misspecified. But other"},{"speaker":"Patrick","startTime":2145.75,"endTime":2149.89,"body":"than that, Mrs. Lincoln, how did"},{"speaker":"Patrick","startTime":2145.75,"endTime":2149.89,"body":"you like the play? And then he"},{"speaker":"Patrick","startTime":2149.89,"endTime":2153.28,"body":"goes into what is it? What does"},{"speaker":"Patrick","startTime":2149.89,"endTime":2153.28,"body":"it have to offer and all the"},{"speaker":"Patrick","startTime":2153.28,"endTime":2158.26,"body":"things like that? The remarkable"},{"speaker":"Patrick","startTime":2153.28,"endTime":2158.26,"body":"insight, at least in my opinion"},{"speaker":"Patrick","startTime":2158.26,"endTime":2162.01,"body":"that Ken had in this whole thing"},{"speaker":"Patrick","startTime":2158.26,"endTime":2162.01,"body":"was all the two stage least"},{"speaker":"Patrick","startTime":2162.01,"endTime":2166.27,"body":"squares estimators, up till that"},{"speaker":"Patrick","startTime":2162.01,"endTime":2166.27,"body":"point required an external"},{"speaker":"Patrick","startTime":2166.27,"endTime":2169.69,"body":"instrumental variable. You"},{"speaker":"Patrick","startTime":2166.27,"endTime":2169.69,"body":"alluded to that a bit ago in the"},{"speaker":"Patrick","startTime":2169.69,"endTime":2172.9,"body":"conversation, assuming that"},{"speaker":"Patrick","startTime":2169.69,"endTime":2172.9,"body":"didn't get cut, it depends who"},{"speaker":"Patrick","startTime":2172.9,"endTime":2176.8,"body":"edits this, it'll get cut. If I"},{"speaker":"Patrick","startTime":2172.9,"endTime":2176.8,"body":"edit it, it won't get cut if you"},{"speaker":"Patrick","startTime":2176.8,"endTime":2179.35,"body":"edit. So we'll see. It was"},{"speaker":"Patrick","startTime":2176.8,"endTime":2179.35,"body":"brilliant. It was brilliant."},{"speaker":"Patrick","startTime":2179.47,"endTime":2183.31,"body":"Alright, sometimes those are"},{"speaker":"Patrick","startTime":2179.47,"endTime":2183.31,"body":"called auxilary. instrumental"},{"speaker":"Patrick","startTime":2183.31,"endTime":2185.8,"body":"variables, those are just"},{"speaker":"Patrick","startTime":2183.31,"endTime":2185.8,"body":"external things that we bring."},{"speaker":"Patrick","startTime":2186.16,"endTime":2189.94,"body":"In my opinion, this is one of"},{"speaker":"Patrick","startTime":2186.16,"endTime":2189.94,"body":"the things that has led to the"},{"speaker":"Patrick","startTime":2189.94,"endTime":2194.17,"body":"limitations of use in at least"},{"speaker":"Patrick","startTime":2189.94,"endTime":2194.17,"body":"Behavioral Sciences is it's"},{"speaker":"Patrick","startTime":2194.17,"endTime":2198.4,"body":"really hard to find these"},{"speaker":"Patrick","startTime":2194.17,"endTime":2198.4,"body":"instrumental variables. Not only"},{"speaker":"Patrick","startTime":2198.4,"endTime":2201.64,"body":"is it hard to find one that"},{"speaker":"Patrick","startTime":2198.4,"endTime":2201.64,"body":"meets the requirements of being"},{"speaker":"Patrick","startTime":2201.64,"endTime":2206.29,"body":"correlated with x, but not with"},{"speaker":"Patrick","startTime":2201.64,"endTime":2206.29,"body":"y. But it's not like a bunch of"},{"speaker":"Patrick","startTime":2206.29,"endTime":2209.77,"body":"us have these variables laying"},{"speaker":"Patrick","startTime":2206.29,"endTime":2209.77,"body":"around that we don't consider."},{"speaker":"Patrick","startTime":2209.8,"endTime":2214.06,"body":"Yeah, gosh, I totally forgot"},{"speaker":"Patrick","startTime":2209.8,"endTime":2214.06,"body":"about this predictor variable,"},{"speaker":"Patrick","startTime":2214.06,"endTime":2217.93,"body":"right? We have a million dollar"},{"speaker":"Patrick","startTime":2214.06,"endTime":2217.93,"body":"data set, and we're using"},{"speaker":"Patrick","startTime":2217.96,"endTime":2221.11,"body":"everything that we have"},{"speaker":"Patrick","startTime":2217.96,"endTime":2221.11,"body":"available. It's a bit easier to"},{"speaker":"Patrick","startTime":2221.11,"endTime":2224.95,"body":"do that. Not easy, but easier in"},{"speaker":"Patrick","startTime":2221.11,"endTime":2224.95,"body":"econometrics, because you can"},{"speaker":"Patrick","startTime":2224.95,"endTime":2228.34,"body":"look at things like oh, the"},{"speaker":"Patrick","startTime":2224.95,"endTime":2228.34,"body":"National Weather Service has"},{"speaker":"Patrick","startTime":2228.34,"endTime":2231.34,"body":"rainfall rates for these"},{"speaker":"Patrick","startTime":2228.34,"endTime":2231.34,"body":"different regions, and I can"},{"speaker":"Patrick","startTime":2231.34,"endTime":2234.85,"body":"link those to where my regions"},{"speaker":"Patrick","startTime":2231.34,"endTime":2234.85,"body":"are that I have butter"},{"speaker":"Patrick","startTime":2234.85,"endTime":2238.63,"body":"production. So that is the old"},{"speaker":"Patrick","startTime":2234.85,"endTime":2238.63,"body":"school to stage least squares."},{"speaker":"Patrick","startTime":2238.63,"endTime":2245.29,"body":"So auxilary Ken's Insight was we"},{"speaker":"Patrick","startTime":2238.63,"endTime":2245.29,"body":"can rewrite the model where we"},{"speaker":"Patrick","startTime":2245.29,"endTime":2250.3,"body":"have model implied instrumental"},{"speaker":"Patrick","startTime":2245.29,"endTime":2250.3,"body":"variables missives, right, we"},{"speaker":"Patrick","startTime":2250.3,"endTime":2253.78,"body":"have to have acronyms, and we"},{"speaker":"Patrick","startTime":2250.3,"endTime":2253.78,"body":"have to have acronyms that we"},{"speaker":"Patrick","startTime":2253.78,"endTime":2263.17,"body":"can pronounce. Unlike Bowers"},{"speaker":"Patrick","startTime":2253.78,"endTime":2263.17,"body":"move. Model implied instrumental"},{"speaker":"Patrick","startTime":2263.17,"endTime":2267.91,"body":"variable Am I V is mivv mivv, to"},{"speaker":"Patrick","startTime":2263.17,"endTime":2267.91,"body":"stage least squares estimation."},{"speaker":"Patrick","startTime":2268.36,"endTime":2272.26,"body":"Everything we've talked about up"},{"speaker":"Patrick","startTime":2268.36,"endTime":2272.26,"body":"to this point still applies. But"},{"speaker":"Patrick","startTime":2272.26,"endTime":2275.68,"body":"instead of having an external"},{"speaker":"Patrick","startTime":2272.26,"endTime":2275.68,"body":"variable we bring to bear, we"},{"speaker":"Patrick","startTime":2275.68,"endTime":2280.54,"body":"are able to identify instruments"},{"speaker":"Patrick","startTime":2275.68,"endTime":2280.54,"body":"that are implied by the model"},{"speaker":"Patrick","startTime":2280.54,"endTime":2284.2,"body":"that we can use equation by"},{"speaker":"Patrick","startTime":2280.54,"endTime":2284.2,"body":"equation. And that's the"},{"speaker":"Patrick","startTime":2284.2,"endTime":2286.24,"body":"cornerstone to mivv sem"},{"speaker":"Greg","startTime":2286.269,"endTime":2289.179,"body":"crazy clever that it was"},{"speaker":"Greg","startTime":2286.269,"endTime":2289.179,"body":"sitting right there in front of"},{"speaker":"Greg","startTime":2289.179,"endTime":2292.209,"body":"us all along within our latent"},{"speaker":"Greg","startTime":2289.179,"endTime":2292.209,"body":"variable model, right in our"},{"speaker":"Greg","startTime":2292.209,"endTime":2295.149,"body":"latent variable model, where we"},{"speaker":"Greg","startTime":2292.209,"endTime":2295.149,"body":"have multiple indicators of each"},{"speaker":"Greg","startTime":2295.149,"endTime":2297.609,"body":"of our latent variables. And"},{"speaker":"Greg","startTime":2295.149,"endTime":2297.609,"body":"then the latent variables"},{"speaker":"Greg","startTime":2297.609,"endTime":2300.999,"body":"themselves have some kind of"},{"speaker":"Greg","startTime":2297.609,"endTime":2300.999,"body":"structural relations among them,"},{"speaker":"Greg","startTime":2301.209,"endTime":2304.329,"body":"which is really what we usually"},{"speaker":"Greg","startTime":2301.209,"endTime":2304.329,"body":"want to test in those kinds of"},{"speaker":"Greg","startTime":2304.329,"endTime":2307.389,"body":"models. And so the question is,"},{"speaker":"Greg","startTime":2304.329,"endTime":2307.389,"body":"how can we deal with this"},{"speaker":"Greg","startTime":2307.389,"endTime":2310.659,"body":"instrumental variable problem"},{"speaker":"Greg","startTime":2307.389,"endTime":2310.659,"body":"and still maintain the integrity"},{"speaker":"Greg","startTime":2310.839,"endTime":2312.999,"body":"of the assessment of the"},{"speaker":"Greg","startTime":2310.839,"endTime":2312.999,"body":"structural relations among the"},{"speaker":"Greg","startTime":2312.999,"endTime":2316.449,"body":"factors? Well, that's what Bolin"},{"speaker":"Greg","startTime":2312.999,"endTime":2316.449,"body":"helped to show us this is really"},{"speaker":"Greg","startTime":2316.449,"endTime":2317.679,"body":"clever, it is incredibly"},{"speaker":"Patrick","startTime":2317.68,"endTime":2320.62,"body":"clever. Again, we are"},{"speaker":"Patrick","startTime":2317.68,"endTime":2320.62,"body":"not going to teach you how to do"},{"speaker":"Patrick","startTime":2320.65,"endTime":2324.67,"body":"mivv to stage least squares, sem"},{"speaker":"Patrick","startTime":2320.65,"endTime":2324.67,"body":"isn't a greatest actually, there"},{"speaker":"Patrick","startTime":2324.67,"endTime":2329.23,"body":"are three acronyms that you use"},{"speaker":"Patrick","startTime":2324.67,"endTime":2329.23,"body":"is it's May of two SLS SEM,"},{"speaker":"Greg","startTime":2329.68,"endTime":2331.99,"body":"which takes us long to say"},{"speaker":"Greg","startTime":2329.68,"endTime":2331.99,"body":"as the words actually"},{"speaker":"Patrick","startTime":2333.01,"endTime":2336.04,"body":"can lays out in his"},{"speaker":"Patrick","startTime":2333.01,"endTime":2336.04,"body":"work. And when I say Ken, a lot"},{"speaker":"Patrick","startTime":2336.04,"endTime":2339.58,"body":"of it is on his own, but also a"},{"speaker":"Patrick","startTime":2336.04,"endTime":2339.58,"body":"lot of collaborative work with"},{"speaker":"Patrick","startTime":2339.58,"endTime":2343.03,"body":"colleagues and students and"},{"speaker":"Patrick","startTime":2339.58,"endTime":2343.03,"body":"postdocs and junior faculty. And"},{"speaker":"Patrick","startTime":2343.03,"endTime":2346.51,"body":"so I'm just gonna say, Ken, and"},{"speaker":"Patrick","startTime":2343.03,"endTime":2346.51,"body":"I mean kind of a whole group,"},{"speaker":"Patrick","startTime":2346.99,"endTime":2350.35,"body":"but there are five core steps"},{"speaker":"Patrick","startTime":2346.99,"endTime":2350.35,"body":"that he lays out in this."},{"speaker":"Patrick","startTime":2350.35,"endTime":2352.66,"body":"Alright, so we're talking about"},{"speaker":"Patrick","startTime":2350.35,"endTime":2352.66,"body":"latent variable models. So we"},{"speaker":"Patrick","startTime":2352.66,"endTime":2355.75,"body":"have latent factors that are"},{"speaker":"Patrick","startTime":2352.66,"endTime":2355.75,"body":"multiple indicators. Step one is"},{"speaker":"Patrick","startTime":2355.75,"endTime":2358.48,"body":"what we do in all of it, right?"},{"speaker":"Patrick","startTime":2355.75,"endTime":2358.48,"body":"It's the rap that I want to have"},{"speaker":"Patrick","startTime":2358.48,"endTime":2362.41,"body":"for all of SEM, which I won't do"},{"speaker":"Patrick","startTime":2358.48,"endTime":2362.41,"body":"it because it will just be"},{"speaker":"Patrick","startTime":2362.41,"endTime":2362.95,"body":"horrible"},{"speaker":"Greg","startTime":2362.979,"endTime":2363.729,"body":"do it."},{"speaker":"Patrick","startTime":2366.28,"endTime":2369.34,"body":"Specification, but"},{"speaker":"Patrick","startTime":2366.28,"endTime":2369.34,"body":"identification, estimation,"},{"speaker":"Patrick","startTime":2369.37,"endTime":2374.29,"body":"evaluation, re specification,"},{"speaker":"Patrick","startTime":2369.37,"endTime":2374.29,"body":"interpretation, interpretation,"},{"speaker":"Patrick","startTime":2374.59,"endTime":2376.9,"body":"interpretation, interpretation."},{"speaker":"Greg","startTime":2378.85,"endTime":2381.01,"body":"Well, Patrick did not"},{"speaker":"Greg","startTime":2378.85,"endTime":2381.01,"body":"authorize that rap, he does"},{"speaker":"Greg","startTime":2381.01,"endTime":2383.32,"body":"understand that there are risks"},{"speaker":"Greg","startTime":2381.01,"endTime":2383.32,"body":"associated with letting me edit"},{"speaker":"Greg","startTime":2383.32,"endTime":2383.98,"body":"the episode."},{"speaker":"Patrick","startTime":2384.55,"endTime":2387.76,"body":"Those are the six steps"},{"speaker":"Patrick","startTime":2384.55,"endTime":2387.76,"body":"of any sem that you all should"},{"speaker":"Patrick","startTime":2387.76,"endTime":2391.96,"body":"have at your fingertips. Step"},{"speaker":"Patrick","startTime":2387.76,"endTime":2391.96,"body":"one in mivv to stage least"},{"speaker":"Patrick","startTime":2391.96,"endTime":2396.22,"body":"squares Sam, is you specify them"},{"speaker":"Patrick","startTime":2391.96,"endTime":2396.22,"body":"up so all the usual ways."},{"speaker":"Patrick","startTime":2396.43,"endTime":2400.18,"body":"Alright, is it a CFA do we only"},{"speaker":"Patrick","startTime":2396.43,"endTime":2400.18,"body":"have Leighton covariances in"},{"speaker":"Patrick","startTime":2400.18,"endTime":2404.29,"body":"SEM, do we have structure? What"},{"speaker":"Patrick","startTime":2400.18,"endTime":2404.29,"body":"items load on what factors? Do"},{"speaker":"Patrick","startTime":2404.29,"endTime":2407.08,"body":"you have correlated residuals"},{"speaker":"Patrick","startTime":2404.29,"endTime":2407.08,"body":"draw your models for whiteboard"},{"speaker":"Patrick","startTime":2407.08,"endTime":2410.83,"body":"problem, there are two ways that"},{"speaker":"Patrick","startTime":2407.08,"endTime":2410.83,"body":"we can set the metric of the"},{"speaker":"Patrick","startTime":2410.83,"endTime":2414.04,"body":"latent factor, you can either"},{"speaker":"Patrick","startTime":2410.83,"endTime":2414.04,"body":"standard isolating factor,"},{"speaker":"Patrick","startTime":2414.04,"endTime":2417.61,"body":"meaning that we set the variance"},{"speaker":"Patrick","startTime":2414.04,"endTime":2417.61,"body":"to one and the mean to zero and"},{"speaker":"Patrick","startTime":2417.61,"endTime":2419.92,"body":"then you estimate all your"},{"speaker":"Patrick","startTime":2417.61,"endTime":2419.92,"body":"loadings and all your items and"},{"speaker":"Patrick","startTime":2419.92,"endTime":2422.92,"body":"intercepts. Or you use what's"},{"speaker":"Patrick","startTime":2419.92,"endTime":2422.92,"body":"called an indicator variable,"},{"speaker":"Patrick","startTime":2423.37,"endTime":2427.48,"body":"you pick one indicator, and you"},{"speaker":"Patrick","startTime":2423.37,"endTime":2427.48,"body":"set the intercept of that to"},{"speaker":"Patrick","startTime":2427.48,"endTime":2431.53,"body":"zero and the loading to one that"},{"speaker":"Patrick","startTime":2427.48,"endTime":2431.53,"body":"sets the metric of the latent"},{"speaker":"Patrick","startTime":2431.53,"endTime":2433.87,"body":"factor. And then you estimate"},{"speaker":"Patrick","startTime":2431.53,"endTime":2433.87,"body":"the mean and variance of the"},{"speaker":"Patrick","startTime":2433.87,"endTime":2436.72,"body":"latent factor, those two are"},{"speaker":"Patrick","startTime":2433.87,"endTime":2436.72,"body":"equivalent, you get the same log"},{"speaker":"Patrick","startTime":2436.72,"endTime":2439.42,"body":"likelihood you get the same"},{"speaker":"Patrick","startTime":2436.72,"endTime":2439.42,"body":"standardized solution. What's"},{"speaker":"Patrick","startTime":2439.42,"endTime":2442.84,"body":"really important in two stage"},{"speaker":"Patrick","startTime":2439.42,"endTime":2442.84,"body":"least squares is you have to use"},{"speaker":"Patrick","startTime":2442.84,"endTime":2446.02,"body":"an indicator variable to set the"},{"speaker":"Patrick","startTime":2442.84,"endTime":2446.02,"body":"metric and only works if you do"},{"speaker":"Patrick","startTime":2446.02,"endTime":2450.76,"body":"that, yes, the second step is"},{"speaker":"Patrick","startTime":2446.02,"endTime":2450.76,"body":"where the really clever part"},{"speaker":"Patrick","startTime":2450.76,"endTime":2455.98,"body":"comes in. And it's called"},{"speaker":"Patrick","startTime":2450.76,"endTime":2455.98,"body":"Transform latent to observed and"},{"speaker":"Patrick","startTime":2456.01,"endTime":2461.8,"body":"can does T L to O. At this"},{"speaker":"Patrick","startTime":2456.01,"endTime":2461.8,"body":"point, I think he's just messing"},{"speaker":"Patrick","startTime":2461.8,"endTime":2465.82,"body":"with us, what you're going to do"},{"speaker":"Patrick","startTime":2461.8,"endTime":2465.82,"body":"is we have these latent factors,"},{"speaker":"Patrick","startTime":2466.12,"endTime":2470.68,"body":"we are going to reexpress the"},{"speaker":"Patrick","startTime":2466.12,"endTime":2470.68,"body":"model as a function of the"},{"speaker":"Patrick","startTime":2470.68,"endTime":2475.75,"body":"scaling indicators, minus their"},{"speaker":"Patrick","startTime":2470.68,"endTime":2475.75,"body":"errors. It takes the latent"},{"speaker":"Patrick","startTime":2475.75,"endTime":2479.14,"body":"variables out of these"},{"speaker":"Patrick","startTime":2475.75,"endTime":2479.14,"body":"equations. But here's where he"},{"speaker":"Patrick","startTime":2479.14,"endTime":2483.34,"body":"was so freaking clever. When you"},{"speaker":"Patrick","startTime":2479.14,"endTime":2483.34,"body":"do that for a system of"},{"speaker":"Patrick","startTime":2483.34,"endTime":2488.08,"body":"simultaneous equations, you"},{"speaker":"Patrick","startTime":2483.34,"endTime":2488.08,"body":"build in endogeneity. It is your"},{"speaker":"Patrick","startTime":2488.08,"endTime":2494.59,"body":"fault. You have built into your"},{"speaker":"Patrick","startTime":2488.08,"endTime":2494.59,"body":"model on purpose, correlations"},{"speaker":"Patrick","startTime":2494.62,"endTime":2498.49,"body":"between certain predictors and"},{"speaker":"Patrick","startTime":2494.62,"endTime":2498.49,"body":"certain residuals, right. That's"},{"speaker":"Patrick","startTime":2498.52,"endTime":2502.99,"body":"the point. That's what he does"},{"speaker":"Patrick","startTime":2498.52,"endTime":2502.99,"body":"intentionally. So you reexpress"},{"speaker":"Patrick","startTime":2502.99,"endTime":2505.27,"body":"your latent variables in terms"},{"speaker":"Patrick","startTime":2502.99,"endTime":2505.27,"body":"of what you observed. That's"},{"speaker":"Patrick","startTime":2505.27,"endTime":2509.08,"body":"step two. Step three is what's"},{"speaker":"Patrick","startTime":2505.27,"endTime":2509.08,"body":"always been the hard one is you"},{"speaker":"Patrick","startTime":2509.08,"endTime":2512.08,"body":"go on a snipe hunt. I don't know"},{"speaker":"Patrick","startTime":2509.08,"endTime":2512.08,"body":"if anybody's familiar with what"},{"speaker":"Patrick","startTime":2512.08,"endTime":2515.62,"body":"a snipe hunt is, but it's an old"},{"speaker":"Patrick","startTime":2512.08,"endTime":2515.62,"body":"gag is if you go camping with"},{"speaker":"Patrick","startTime":2515.62,"endTime":2518.98,"body":"somebody new and you send them"},{"speaker":"Patrick","startTime":2515.62,"endTime":2518.98,"body":"to go catch a snipe for dinner."},{"speaker":"Patrick","startTime":2519.28,"endTime":2522.31,"body":"And snipes don't really exist."},{"speaker":"Patrick","startTime":2519.28,"endTime":2522.31,"body":"But you sit around the fire"},{"speaker":"Patrick","startTime":2522.31,"endTime":2524.41,"body":"drinkin beer, and they're out in"},{"speaker":"Patrick","startTime":2522.31,"endTime":2524.41,"body":"the woods trying to catch"},{"speaker":"Patrick","startTime":2524.41,"endTime":2527.23,"body":"something that doesn't exist."},{"speaker":"Patrick","startTime":2524.41,"endTime":2527.23,"body":"That's what a snipe hunt is."},{"speaker":"Patrick","startTime":2527.29,"endTime":2530.83,"body":"Hmm. Step three is you got to"},{"speaker":"Patrick","startTime":2527.29,"endTime":2530.83,"body":"find the model implied"},{"speaker":"Patrick","startTime":2530.86,"endTime":2534.76,"body":"instrumental variables and Ken"},{"speaker":"Patrick","startTime":2530.86,"endTime":2534.76,"body":"describes how we go about doing"},{"speaker":"Patrick","startTime":2534.76,"endTime":2538.15,"body":"this how you identify it. Zach"},{"speaker":"Patrick","startTime":2534.76,"endTime":2538.15,"body":"Fisher, who we're going to talk"},{"speaker":"Patrick","startTime":2538.15,"endTime":2541.6,"body":"about, Zach is one of my"},{"speaker":"Patrick","startTime":2538.15,"endTime":2541.6,"body":"favorite people. And he is an"},{"speaker":"Patrick","startTime":2541.6,"endTime":2545.2,"body":"assistant professor on the quant"},{"speaker":"Patrick","startTime":2541.6,"endTime":2545.2,"body":"program at Penn State now. And"},{"speaker":"Patrick","startTime":2545.2,"endTime":2550.54,"body":"he wrote a really powerful"},{"speaker":"Patrick","startTime":2545.2,"endTime":2550.54,"body":"accessible package in or"},{"speaker":"Patrick","startTime":2550.69,"endTime":2554.68,"body":"cleverly called MIB sem that"},{"speaker":"Patrick","startTime":2550.69,"endTime":2554.68,"body":"automates this, but you have to"},{"speaker":"Patrick","startTime":2554.68,"endTime":2558.19,"body":"identify these model implied"},{"speaker":"Patrick","startTime":2554.68,"endTime":2558.19,"body":"instrumental variables once you"},{"speaker":"Patrick","startTime":2558.19,"endTime":2562.84,"body":"get the instrumental variables,"},{"speaker":"Patrick","startTime":2558.19,"endTime":2562.84,"body":"dude, x prime x inverse x prime"},{"speaker":"Patrick","startTime":2562.84,"endTime":2568.48,"body":"y, all of this complexity that"},{"speaker":"Patrick","startTime":2562.84,"endTime":2568.48,"body":"we're doing, you regress your"},{"speaker":"Patrick","startTime":2568.48,"endTime":2571.87,"body":"problematic covariates on your"},{"speaker":"Patrick","startTime":2568.48,"endTime":2571.87,"body":"instruments you say about the"},{"speaker":"Patrick","startTime":2571.87,"endTime":2575.41,"body":"predicted values. And then in"},{"speaker":"Patrick","startTime":2571.87,"endTime":2575.41,"body":"the second stage, you use the"},{"speaker":"Patrick","startTime":2575.41,"endTime":2579.58,"body":"predicted values to predict the"},{"speaker":"Patrick","startTime":2575.41,"endTime":2579.58,"body":"dependent variables, because you"},{"speaker":"Patrick","startTime":2579.58,"endTime":2582.88,"body":"have unhooked those correlations"},{"speaker":"Patrick","startTime":2579.58,"endTime":2582.88,"body":"between the predictors and the"},{"speaker":"Patrick","startTime":2582.88,"endTime":2586.45,"body":"residuals. It is x prime x"},{"speaker":"Patrick","startTime":2582.88,"endTime":2586.45,"body":"inverse x prime y, you do it"},{"speaker":"Patrick","startTime":2586.45,"endTime":2590.5,"body":"equation by equation, and you"},{"speaker":"Patrick","startTime":2586.45,"endTime":2590.5,"body":"get the estimates. And then I"},{"speaker":"Patrick","startTime":2590.5,"endTime":2593.32,"body":"don't want to delve into this"},{"speaker":"Patrick","startTime":2590.5,"endTime":2593.32,"body":"too much here. But the fifth"},{"speaker":"Patrick","startTime":2593.32,"endTime":2596.95,"body":"step is, if you have an over"},{"speaker":"Patrick","startTime":2593.32,"endTime":2596.95,"body":"identified equation, meaning"},{"speaker":"Patrick","startTime":2596.95,"endTime":2600.76,"body":"more instruments than you need"},{"speaker":"Patrick","startTime":2596.95,"endTime":2600.76,"body":"for estimation, there's a thing"},{"speaker":"Patrick","startTime":2600.76,"endTime":2605.83,"body":"called a Sargon test, where it"},{"speaker":"Patrick","startTime":2600.76,"endTime":2605.83,"body":"gives you an inferential test of"},{"speaker":"Patrick","startTime":2605.86,"endTime":2608.23,"body":"whether the instruments are"},{"speaker":"Patrick","startTime":2605.86,"endTime":2608.23,"body":"working in the way that they"},{"speaker":"Patrick","startTime":2608.23,"endTime":2611.11,"body":"should. So if it's a non"},{"speaker":"Patrick","startTime":2608.23,"endTime":2611.11,"body":"significant test, the"},{"speaker":"Patrick","startTime":2611.11,"endTime":2613.93,"body":"characteristics of the data are"},{"speaker":"Patrick","startTime":2611.11,"endTime":2613.93,"body":"consistent with that your"},{"speaker":"Patrick","startTime":2613.93,"endTime":2616.87,"body":"predictors are uncorrelated with"},{"speaker":"Patrick","startTime":2613.93,"endTime":2616.87,"body":"the residuals, if you get a"},{"speaker":"Patrick","startTime":2616.87,"endTime":2621.4,"body":"significant test that is"},{"speaker":"Patrick","startTime":2616.87,"endTime":2621.4,"body":"violated, which actually implies"},{"speaker":"Patrick","startTime":2621.4,"endTime":2624.25,"body":"there may be a mis specification"},{"speaker":"Patrick","startTime":2621.4,"endTime":2624.25,"body":"within the model. And that's"},{"speaker":"Greg","startTime":2624.25,"endTime":2627.25,"body":"incredibly powerful."},{"speaker":"Greg","startTime":2624.25,"endTime":2627.25,"body":"Because the modeling that you"},{"speaker":"Greg","startTime":2627.25,"endTime":2630.49,"body":"and I are accustomed to doing is"},{"speaker":"Greg","startTime":2627.25,"endTime":2630.49,"body":"generally very global, right? We"},{"speaker":"Greg","startTime":2630.49,"endTime":2632.77,"body":"assess the fit of the model"},{"speaker":"Greg","startTime":2630.49,"endTime":2632.77,"body":"globally, and we go, hey, it's"},{"speaker":"Greg","startTime":2632.77,"endTime":2636.22,"body":"working great, or oh, it's not"},{"speaker":"Greg","startTime":2632.77,"endTime":2636.22,"body":"working so well. And then maybe"},{"speaker":"Greg","startTime":2636.22,"endTime":2639.1,"body":"we use modification indices to"},{"speaker":"Greg","startTime":2636.22,"endTime":2639.1,"body":"try and figure out what's going"},{"speaker":"Greg","startTime":2639.1,"endTime":2642.73,"body":"wrong. We don't take a very"},{"speaker":"Greg","startTime":2639.1,"endTime":2642.73,"body":"local perspective, in practice,"},{"speaker":"Greg","startTime":2642.76,"endTime":2646.51,"body":"unfortunately, the beautiful"},{"speaker":"Greg","startTime":2642.76,"endTime":2646.51,"body":"thing about this strategy is"},{"speaker":"Greg","startTime":2646.51,"endTime":2649.96,"body":"that you get a whole series of"},{"speaker":"Greg","startTime":2646.51,"endTime":2649.96,"body":"equations out of this where you"},{"speaker":"Greg","startTime":2649.96,"endTime":2654.13,"body":"can assess the fit much, much"},{"speaker":"Greg","startTime":2649.96,"endTime":2654.13,"body":"more locally, you know, oh, this"},{"speaker":"Greg","startTime":2654.13,"endTime":2657.34,"body":"is locally just identified. This"},{"speaker":"Greg","startTime":2654.13,"endTime":2657.34,"body":"is locally over identified"},{"speaker":"Greg","startTime":2657.34,"endTime":2660.7,"body":"great, how's the fit in this"},{"speaker":"Greg","startTime":2657.34,"endTime":2660.7,"body":"over identified circumstance. So"},{"speaker":"Greg","startTime":2660.7,"endTime":2663.16,"body":"the idea of being able to"},{"speaker":"Greg","startTime":2660.7,"endTime":2663.16,"body":"pinpoint what parts of your"},{"speaker":"Greg","startTime":2663.16,"endTime":2666.58,"body":"model are working well, and what"},{"speaker":"Greg","startTime":2663.16,"endTime":2666.58,"body":"parts of your model are not is"},{"speaker":"Greg","startTime":2666.61,"endTime":2670.48,"body":"hugely important, I think from a"},{"speaker":"Greg","startTime":2666.61,"endTime":2670.48,"body":"diagnostic standpoint, and it's"},{"speaker":"Greg","startTime":2670.48,"endTime":2673.45,"body":"something that we just don't"},{"speaker":"Greg","startTime":2670.48,"endTime":2673.45,"body":"have a good handle on in the"},{"speaker":"Greg","startTime":2673.45,"endTime":2677.47,"body":"maximum likelihood world. So I"},{"speaker":"Greg","startTime":2673.45,"endTime":2677.47,"body":"love this aspect of MIB tools,"},{"speaker":"Greg","startTime":2677.47,"endTime":2677.98,"body":"some some,"},{"speaker":"Patrick","startTime":2679.03,"endTime":2683.53,"body":"on top of that, that"},{"speaker":"Patrick","startTime":2679.03,"endTime":2683.53,"body":"equation by equation estimator"},{"speaker":"Patrick","startTime":2683.56,"endTime":2686.8,"body":"that you just described them,"},{"speaker":"Patrick","startTime":2683.56,"endTime":2686.8,"body":"the tests of that, that actually"},{"speaker":"Patrick","startTime":2686.8,"endTime":2691.0,"body":"is gonna give us a huge"},{"speaker":"Patrick","startTime":2686.8,"endTime":2691.0,"body":"advantage under a lot of"},{"speaker":"Patrick","startTime":2691.0,"endTime":2694.63,"body":"circumstances. Not always, but"},{"speaker":"Patrick","startTime":2691.0,"endTime":2694.63,"body":"under a lot of them. And that"},{"speaker":"Patrick","startTime":2694.63,"endTime":2698.5,"body":"is, you know, what it protects"},{"speaker":"Patrick","startTime":2694.63,"endTime":2698.5,"body":"against Whack a Mole. Yeah,"},{"speaker":"Patrick","startTime":2698.53,"endTime":2702.55,"body":"let's think a little bit about"},{"speaker":"Patrick","startTime":2698.53,"endTime":2702.55,"body":"what are the advantages? What is"},{"speaker":"Patrick","startTime":2702.55,"endTime":2707.32,"body":"can argue for why you would go"},{"speaker":"Patrick","startTime":2702.55,"endTime":2707.32,"body":"this route? Because again, ml,"},{"speaker":"Patrick","startTime":2707.59,"endTime":2714.67,"body":"man ml lifts weights, ml can"},{"speaker":"Patrick","startTime":2707.59,"endTime":2714.67,"body":"dance. ML is funny. ML is not"},{"speaker":"Patrick","startTime":2714.67,"endTime":2719.59,"body":"hard on the eyes, I'll tell you"},{"speaker":"Patrick","startTime":2714.67,"endTime":2719.59,"body":"that. Why would we not do it?"},{"speaker":"Patrick","startTime":2719.62,"endTime":2725.05,"body":"Well, this is that fine print."},{"speaker":"Patrick","startTime":2719.62,"endTime":2725.05,"body":"Yes, ML is the game in town,"},{"speaker":"Patrick","startTime":2725.08,"endTime":2729.76,"body":"when you meet those assumptions,"},{"speaker":"Patrick","startTime":2725.08,"endTime":2729.76,"body":"when you don't, that directly"},{"speaker":"Patrick","startTime":2729.76,"endTime":2734.17,"body":"undermines all of those goodies"},{"speaker":"Patrick","startTime":2729.76,"endTime":2734.17,"body":"that we brag about when we use"},{"speaker":"Patrick","startTime":2734.17,"endTime":2737.44,"body":"maximum likelihood. That's"},{"speaker":"Patrick","startTime":2734.17,"endTime":2737.44,"body":"right, it is not asymptotically,"},{"speaker":"Patrick","startTime":2737.47,"endTime":2740.47,"body":"efficient, consistent and"},{"speaker":"Patrick","startTime":2737.47,"endTime":2740.47,"body":"unbiased, when you have a"},{"speaker":"Patrick","startTime":2740.47,"endTime":2741.64,"body":"misspecified model."},{"speaker":"Greg","startTime":2741.7,"endTime":2743.83,"body":"That's right, we can"},{"speaker":"Greg","startTime":2741.7,"endTime":2743.83,"body":"tinker with the non normality"},{"speaker":"Greg","startTime":2743.83,"endTime":2747.28,"body":"problem, we can overcome some of"},{"speaker":"Greg","startTime":2743.83,"endTime":2747.28,"body":"those things. But the structural"},{"speaker":"Greg","startTime":2747.28,"endTime":2750.13,"body":"problems, that is huge and"},{"speaker":"Greg","startTime":2747.28,"endTime":2750.13,"body":"maximum likelihood is not going"},{"speaker":"Greg","startTime":2750.13,"endTime":2752.68,"body":"to help you fix them to stage"},{"speaker":"Greg","startTime":2750.13,"endTime":2752.68,"body":"least squares helps you with"},{"speaker":"Greg","startTime":2752.68,"endTime":2753.79,"body":"that. It doesn't cure"},{"speaker":"Patrick","startTime":2753.79,"endTime":2757.15,"body":"it, but it really gets"},{"speaker":"Patrick","startTime":2753.79,"endTime":2757.15,"body":"you quite a ways. And we did"},{"speaker":"Patrick","startTime":2757.15,"endTime":2761.11,"body":"some early simulations, Canon,"},{"speaker":"Patrick","startTime":2757.15,"endTime":2761.11,"body":"myself and some of his grad"},{"speaker":"Patrick","startTime":2761.11,"endTime":2764.32,"body":"students, when you apply to"},{"speaker":"Patrick","startTime":2761.11,"endTime":2764.32,"body":"stage least squares in the way"},{"speaker":"Patrick","startTime":2764.32,"endTime":2767.86,"body":"that we've described. And of"},{"speaker":"Patrick","startTime":2764.32,"endTime":2767.86,"body":"course, there's Calvin Ball"},{"speaker":"Patrick","startTime":2767.86,"endTime":2771.67,"body":"rules that apply to two stage"},{"speaker":"Patrick","startTime":2767.86,"endTime":2771.67,"body":"least squares, right. And it's"},{"speaker":"Patrick","startTime":2771.67,"endTime":2776.44,"body":"not spring break in Orlando with"},{"speaker":"Patrick","startTime":2771.67,"endTime":2776.44,"body":"estimation. I mean, you have to"},{"speaker":"Patrick","startTime":2776.44,"endTime":2780.91,"body":"invoke assumptions on that two"},{"speaker":"Patrick","startTime":2776.44,"endTime":2780.91,"body":"stage least squares with MIBs,"},{"speaker":"Patrick","startTime":2780.91,"endTime":2786.01,"body":"when done properly, is also"},{"speaker":"Patrick","startTime":2780.91,"endTime":2786.01,"body":"consistent and unbiased and ask"},{"speaker":"Patrick","startTime":2786.01,"endTime":2788.74,"body":"them topically normally"},{"speaker":"Patrick","startTime":2786.01,"endTime":2788.74,"body":"distributed, which does give us"},{"speaker":"Patrick","startTime":2788.74,"endTime":2792.04,"body":"standard errors, we can get"},{"speaker":"Patrick","startTime":2788.74,"endTime":2792.04,"body":"analytic standard errors, but"},{"speaker":"Patrick","startTime":2792.04,"endTime":2795.43,"body":"Zack put into this package where"},{"speaker":"Patrick","startTime":2792.04,"endTime":2795.43,"body":"you can also get bootstrap"},{"speaker":"Patrick","startTime":2795.46,"endTime":2800.29,"body":"standard errors. And those seem"},{"speaker":"Patrick","startTime":2795.46,"endTime":2800.29,"body":"to do well. Here's a big one"},{"speaker":"Patrick","startTime":2800.35,"endTime":2805.54,"body":"myth to stage least squares is"},{"speaker":"Patrick","startTime":2800.35,"endTime":2805.54,"body":"non iterative. Oh, yeah, sure."},{"speaker":"Patrick","startTime":2805.54,"endTime":2805.63,"body":"It"},{"speaker":"Greg","startTime":2805.63,"endTime":2807.43,"body":"makes sense. Right?"},{"speaker":"Greg","startTime":2805.63,"endTime":2807.43,"body":"Exactly right,"},{"speaker":"Patrick","startTime":2807.46,"endTime":2810.31,"body":"it makes sense. Because"},{"speaker":"Patrick","startTime":2807.46,"endTime":2810.31,"body":"it's x prime x inverse x prime"},{"speaker":"Patrick","startTime":2810.31,"endTime":2814.36,"body":"y, all you got to do is be able"},{"speaker":"Patrick","startTime":2810.31,"endTime":2814.36,"body":"to invert x prime x. And as long"},{"speaker":"Patrick","startTime":2814.36,"endTime":2817.3,"body":"as you don't have a linear"},{"speaker":"Patrick","startTime":2814.36,"endTime":2817.3,"body":"dependency in your columns, you"},{"speaker":"Patrick","startTime":2817.3,"endTime":2820.24,"body":"need one more person than"},{"speaker":"Patrick","startTime":2817.3,"endTime":2820.24,"body":"predictors. Now, we're not"},{"speaker":"Patrick","startTime":2820.24,"endTime":2825.43,"body":"advocating that. But that allows"},{"speaker":"Patrick","startTime":2820.24,"endTime":2825.43,"body":"you to invert x prime x, it's"},{"speaker":"Patrick","startTime":2825.43,"endTime":2828.97,"body":"non iterative, we'll think about"},{"speaker":"Patrick","startTime":2825.43,"endTime":2828.97,"body":"all of you out there who are"},{"speaker":"Patrick","startTime":2828.97,"endTime":2832.99,"body":"working in smaller sample sizes,"},{"speaker":"Patrick","startTime":2828.97,"endTime":2832.99,"body":"you have maybe a little bit more"},{"speaker":"Patrick","startTime":2832.99,"endTime":2836.44,"body":"complicated models, maybe you"},{"speaker":"Patrick","startTime":2832.99,"endTime":2836.44,"body":"have some mis specification, but"},{"speaker":"Patrick","startTime":2836.44,"endTime":2840.46,"body":"you're not sure where it lives."},{"speaker":"Patrick","startTime":2836.44,"endTime":2840.46,"body":"And models are better than when"},{"speaker":"Patrick","startTime":2840.46,"endTime":2844.03,"body":"you and I came up through the"},{"speaker":"Patrick","startTime":2840.46,"endTime":2844.03,"body":"ranks non convergence was just a"},{"speaker":"Patrick","startTime":2844.03,"endTime":2848.08,"body":"routine problem for you and me."},{"speaker":"Patrick","startTime":2844.03,"endTime":2848.08,"body":"And it's much better now. But it"},{"speaker":"Patrick","startTime":2848.08,"endTime":2852.52,"body":"still exists, you get a model"},{"speaker":"Patrick","startTime":2848.08,"endTime":2852.52,"body":"where ML does all the hill"},{"speaker":"Patrick","startTime":2852.52,"endTime":2855.97,"body":"climbing and valley searching"},{"speaker":"Patrick","startTime":2852.52,"endTime":2855.97,"body":"that we talked about last week."},{"speaker":"Patrick","startTime":2856.18,"endTime":2859.27,"body":"And it comes back to Greg and me"},{"speaker":"Patrick","startTime":2856.18,"endTime":2859.27,"body":"and says yes, sorry, dude, I"},{"speaker":"Patrick","startTime":2859.27,"endTime":2859.78,"body":"can't do it."},{"speaker":"Greg","startTime":2860.379,"endTime":2861.999,"body":"And let me give you an"},{"speaker":"Greg","startTime":2860.379,"endTime":2861.999,"body":"error message that is not"},{"speaker":"Greg","startTime":2861.999,"endTime":2862.629,"body":"helpful. Yeah,"},{"speaker":"Patrick","startTime":2862.66,"endTime":2866.38,"body":"in all caps as if I'm"},{"speaker":"Patrick","startTime":2862.66,"endTime":2866.38,"body":"yelling at you. But it's non"},{"speaker":"Patrick","startTime":2866.38,"endTime":2870.58,"body":"iterative, you always get a"},{"speaker":"Patrick","startTime":2866.38,"endTime":2870.58,"body":"solution into stage least"},{"speaker":"Patrick","startTime":2870.58,"endTime":2874.96,"body":"squares. Yeah, here's maybe the"},{"speaker":"Patrick","startTime":2870.58,"endTime":2874.96,"body":"most important part. In my"},{"speaker":"Patrick","startTime":2874.96,"endTime":2878.17,"body":"opinion, we've talked a lot"},{"speaker":"Patrick","startTime":2874.96,"endTime":2878.17,"body":"about Whack a Mole. And we've"},{"speaker":"Patrick","startTime":2878.17,"endTime":2882.22,"body":"talked a lot about western"},{"speaker":"Patrick","startTime":2878.17,"endTime":2882.22,"body":"Kansas. Remember, you have some"},{"speaker":"Patrick","startTime":2882.22,"endTime":2886.96,"body":"misspecification, out in western"},{"speaker":"Patrick","startTime":2882.22,"endTime":2886.96,"body":"Kansas? And you say I, it's not"},{"speaker":"Patrick","startTime":2886.96,"endTime":2889.96,"body":"going to bother me, because it's"},{"speaker":"Patrick","startTime":2886.96,"endTime":2889.96,"body":"way over there. But that can"},{"speaker":"Patrick","startTime":2889.96,"endTime":2894.01,"body":"propagate through your system of"},{"speaker":"Patrick","startTime":2889.96,"endTime":2894.01,"body":"equations, because the biggest"},{"speaker":"Patrick","startTime":2894.01,"endTime":2896.56,"body":"advantage of maximum likelihood"},{"speaker":"Patrick","startTime":2894.01,"endTime":2896.56,"body":"is it's a full information"},{"speaker":"Patrick","startTime":2896.56,"endTime":2899.14,"body":"estimator. And the biggest"},{"speaker":"Patrick","startTime":2896.56,"endTime":2899.14,"body":"limitation of maximum likelihood"},{"speaker":"Patrick","startTime":2899.17,"endTime":2902.68,"body":"is it is a full information"},{"speaker":"Patrick","startTime":2899.17,"endTime":2902.68,"body":"estimator. Exactly. Right. The"},{"speaker":"Patrick","startTime":2902.68,"endTime":2907.42,"body":"term that I love that can use is"},{"speaker":"Patrick","startTime":2902.68,"endTime":2907.42,"body":"is to stage least squares can"},{"speaker":"Patrick","startTime":2907.42,"endTime":2911.8,"body":"serve to quarantine"},{"speaker":"Patrick","startTime":2907.42,"endTime":2911.8,"body":"misspecification. There, it does"},{"speaker":"Patrick","startTime":2911.8,"endTime":2914.47,"body":"not do away with it. All right."},{"speaker":"Patrick","startTime":2911.8,"endTime":2914.47,"body":"If you have a system of"},{"speaker":"Patrick","startTime":2914.47,"endTime":2916.96,"body":"equations, and you have a"},{"speaker":"Patrick","startTime":2914.47,"endTime":2916.96,"body":"particular equation, and you've"},{"speaker":"Patrick","startTime":2916.96,"endTime":2920.89,"body":"misspecified that, yeah, tough"},{"speaker":"Patrick","startTime":2916.96,"endTime":2920.89,"body":"crap, no estimator is going to"},{"speaker":"Patrick","startTime":2920.89,"endTime":2925.84,"body":"fix that. But because it does it"},{"speaker":"Patrick","startTime":2920.89,"endTime":2925.84,"body":"equation by equation, it drags"},{"speaker":"Patrick","startTime":2925.84,"endTime":2930.19,"body":"barbed wire around that Miss"},{"speaker":"Patrick","startTime":2925.84,"endTime":2930.19,"body":"specification, and it doesn't"},{"speaker":"Patrick","startTime":2930.19,"endTime":2933.61,"body":"allow it to propagate to other"},{"speaker":"Patrick","startTime":2930.19,"endTime":2933.61,"body":"parts of the model. That's a"},{"speaker":"Patrick","startTime":2933.61,"endTime":2935.68,"body":"huge advantage. It is."},{"speaker":"Greg","startTime":2935.68,"endTime":2938.41,"body":"And my recollection is"},{"speaker":"Greg","startTime":2935.68,"endTime":2938.41,"body":"that even in models where it"},{"speaker":"Greg","startTime":2938.41,"endTime":2941.56,"body":"can't fully quarantine it, if"},{"speaker":"Greg","startTime":2938.41,"endTime":2941.56,"body":"you think about a latent"},{"speaker":"Greg","startTime":2941.56,"endTime":2944.17,"body":"variable model, where each of"},{"speaker":"Greg","startTime":2941.56,"endTime":2944.17,"body":"your latent variables has its"},{"speaker":"Greg","startTime":2944.17,"endTime":2946.78,"body":"own little measurement model,"},{"speaker":"Greg","startTime":2944.17,"endTime":2946.78,"body":"and then what you're really"},{"speaker":"Greg","startTime":2946.78,"endTime":2950.05,"body":"interested in are the relations"},{"speaker":"Greg","startTime":2946.78,"endTime":2950.05,"body":"among the latent variables in"},{"speaker":"Greg","startTime":2950.05,"endTime":2952.84,"body":"that structural portion, even"},{"speaker":"Greg","startTime":2950.05,"endTime":2952.84,"body":"when you can't completely"},{"speaker":"Greg","startTime":2952.84,"endTime":2955.96,"body":"quarantine misspecification"},{"speaker":"Greg","startTime":2952.84,"endTime":2955.96,"body":"associated with the measurement"},{"speaker":"Greg","startTime":2955.96,"endTime":2960.07,"body":"models, that you still get"},{"speaker":"Greg","startTime":2955.96,"endTime":2960.07,"body":"pretty darn decent estimates of"},{"speaker":"Greg","startTime":2960.07,"endTime":2963.1,"body":"the relations among the latent"},{"speaker":"Greg","startTime":2960.07,"endTime":2963.1,"body":"variables. Is that accurate?"},{"speaker":"Greg","startTime":2963.13,"endTime":2964.15,"body":"That's exactly"},{"speaker":"Patrick","startTime":2964.15,"endTime":2967.63,"body":"right. Only on there"},{"speaker":"Patrick","startTime":2964.15,"endTime":2967.63,"body":"was some hope that it would"},{"speaker":"Patrick","startTime":2967.63,"endTime":2972.97,"body":"completely quarantine. Now, it's"},{"speaker":"Patrick","startTime":2967.63,"endTime":2972.97,"body":"just a little bit gentler"},{"speaker":"Patrick","startTime":2972.97,"endTime":2978.16,"body":"language is used in the way that"},{"speaker":"Patrick","startTime":2972.97,"endTime":2978.16,"body":"you just described, it minimizes"},{"speaker":"Patrick","startTime":2978.19,"endTime":2981.91,"body":"the propagation of"},{"speaker":"Patrick","startTime":2978.19,"endTime":2981.91,"body":"misspecification to other parts"},{"speaker":"Patrick","startTime":2981.91,"endTime":2986.44,"body":"of the model. Over the years, a"},{"speaker":"Patrick","startTime":2981.91,"endTime":2986.44,"body":"lot of people in my opinion have"},{"speaker":"Patrick","startTime":2986.44,"endTime":2989.71,"body":"been rather dismissive of two"},{"speaker":"Patrick","startTime":2986.44,"endTime":2989.71,"body":"stage least squares. And the"},{"speaker":"Patrick","startTime":2989.71,"endTime":2992.83,"body":"reason is, it is a limited"},{"speaker":"Patrick","startTime":2989.71,"endTime":2992.83,"body":"information. What does that"},{"speaker":"Patrick","startTime":2992.83,"endTime":2996.25,"body":"mean? It means we do it in two"},{"speaker":"Patrick","startTime":2992.83,"endTime":2996.25,"body":"steps. They really tried to hide"},{"speaker":"Patrick","startTime":2996.25,"endTime":2999.94,"body":"that in this method of"},{"speaker":"Patrick","startTime":2996.25,"endTime":2999.94,"body":"estimation by calling it to"},{"speaker":"Patrick","startTime":3000.0,"endTime":3005.67,"body":"stage least squares. It's"},{"speaker":"Patrick","startTime":3000.0,"endTime":3005.67,"body":"limited information, we do the"},{"speaker":"Patrick","startTime":3005.67,"endTime":3008.61,"body":"instruments as predictors."},{"speaker":"Patrick","startTime":3005.67,"endTime":3008.61,"body":"First, we go get a cup of"},{"speaker":"Patrick","startTime":3008.61,"endTime":3012.57,"body":"coffee, come back. And then we"},{"speaker":"Patrick","startTime":3008.61,"endTime":3012.57,"body":"do that second stage. And I"},{"speaker":"Patrick","startTime":3012.57,"endTime":3015.42,"body":"heard one person make a joke"},{"speaker":"Patrick","startTime":3012.57,"endTime":3015.42,"body":"about this at a conference, they"},{"speaker":"Patrick","startTime":3015.42,"endTime":3017.55,"body":"said, Oh, it's two stage, who"},{"speaker":"Patrick","startTime":3015.42,"endTime":3017.55,"body":"cares?"},{"speaker":"Movie Clip","startTime":3018.69,"endTime":3020.52,"body":"Laugh it up"},{"speaker":"Movie Clip","startTime":3018.69,"endTime":3020.52,"body":"Fuzzball."},{"speaker":"Patrick","startTime":3022.68,"endTime":3026.67,"body":"It does have lower"},{"speaker":"Patrick","startTime":3022.68,"endTime":3026.67,"body":"power. Alright. limited"},{"speaker":"Patrick","startTime":3026.67,"endTime":3029.31,"body":"information have lower power"},{"speaker":"Patrick","startTime":3026.67,"endTime":3029.31,"body":"than full information. But it's"},{"speaker":"Patrick","startTime":3029.31,"endTime":3033.75,"body":"can really nicely describes."},{"speaker":"Patrick","startTime":3029.31,"endTime":3033.75,"body":"That's only when regularity"},{"speaker":"Patrick","startTime":3033.75,"endTime":3037.29,"body":"conditions are met. Sure, with"},{"speaker":"Patrick","startTime":3033.75,"endTime":3037.29,"body":"the full information, right,"},{"speaker":"Patrick","startTime":3037.29,"endTime":3041.91,"body":"it's like the circularity you"},{"speaker":"Patrick","startTime":3037.29,"endTime":3041.91,"body":"keep going through around. Yeah,"},{"speaker":"Patrick","startTime":3041.91,"endTime":3046.71,"body":"maximum likelihood is like"},{"speaker":"Patrick","startTime":3041.91,"endTime":3046.71,"body":"flexing down on Venice Beach"},{"speaker":"Patrick","startTime":3046.71,"endTime":3050.07,"body":"about all the things you can do,"},{"speaker":"Patrick","startTime":3046.71,"endTime":3050.07,"body":"but only under regularity"},{"speaker":"Patrick","startTime":3050.07,"endTime":3053.13,"body":"conditions. There are more and"},{"speaker":"Patrick","startTime":3050.07,"endTime":3053.13,"body":"more simulations that are"},{"speaker":"Patrick","startTime":3053.13,"endTime":3056.43,"body":"indicating that when you compare"},{"speaker":"Patrick","startTime":3053.13,"endTime":3056.43,"body":"these estimators under"},{"speaker":"Patrick","startTime":3056.43,"endTime":3059.52,"body":"conditions that we typically"},{"speaker":"Patrick","startTime":3056.43,"endTime":3059.52,"body":"encounter in the kind of work"},{"speaker":"Patrick","startTime":3059.52,"endTime":3065.1,"body":"that we do, either there's no"},{"speaker":"Patrick","startTime":3059.52,"endTime":3065.1,"body":"difference in power, or there's"},{"speaker":"Patrick","startTime":3065.1,"endTime":3068.82,"body":"a slight decrement in two stage"},{"speaker":"Patrick","startTime":3065.1,"endTime":3068.82,"body":"least squares to a point that"},{"speaker":"Patrick","startTime":3068.82,"endTime":3072.09,"body":"nobody cares about. But then you"},{"speaker":"Patrick","startTime":3068.82,"endTime":3072.09,"body":"have to balance with, okay, I'm"},{"speaker":"Patrick","startTime":3072.09,"endTime":3075.57,"body":"having a little bit lower power,"},{"speaker":"Patrick","startTime":3072.09,"endTime":3075.57,"body":"but oh, by the way, my"},{"speaker":"Patrick","startTime":3075.57,"endTime":3079.83,"body":"regression coefficients are less"},{"speaker":"Patrick","startTime":3075.57,"endTime":3079.83,"body":"biased than yours are. So you"},{"speaker":"Patrick","startTime":3079.83,"endTime":3082.5,"body":"are much more likely to find a"},{"speaker":"Patrick","startTime":3079.83,"endTime":3082.5,"body":"significant effect for your"},{"speaker":"Patrick","startTime":3082.5,"endTime":3087.06,"body":"biased regression coefficient"},{"speaker":"Patrick","startTime":3082.5,"endTime":3087.06,"body":"than I am for my unbiased"},{"speaker":"Patrick","startTime":3087.06,"endTime":3088.68,"body":"regression coefficient, you have"},{"speaker":"Greg","startTime":3088.68,"endTime":3092.28,"body":"more power for your wrong"},{"speaker":"Greg","startTime":3088.68,"endTime":3092.28,"body":"thing exactly go you."},{"speaker":"Patrick","startTime":3093.69,"endTime":3098.43,"body":"We are skimming over"},{"speaker":"Patrick","startTime":3093.69,"endTime":3098.43,"body":"the surface of a very deep lake"},{"speaker":"Patrick","startTime":3098.46,"endTime":3102.51,"body":"in all the interesting things"},{"speaker":"Patrick","startTime":3098.46,"endTime":3102.51,"body":"that can be done. But one of the"},{"speaker":"Patrick","startTime":3102.51,"endTime":3106.53,"body":"big points we want to clarify"},{"speaker":"Patrick","startTime":3102.51,"endTime":3106.53,"body":"here is one is remember least"},{"speaker":"Patrick","startTime":3106.53,"endTime":3112.11,"body":"squares has a spinning hook kick"},{"speaker":"Patrick","startTime":3106.53,"endTime":3112.11,"body":"and never ever forget that. So"},{"speaker":"Patrick","startTime":3112.11,"endTime":3116.88,"body":"just respectively squares, and"},{"speaker":"Patrick","startTime":3112.11,"endTime":3116.88,"body":"know that when maximum"},{"speaker":"Patrick","startTime":3116.88,"endTime":3120.66,"body":"likelihood is rubbing baby oil"},{"speaker":"Patrick","startTime":3116.88,"endTime":3120.66,"body":"on its muscles and flexing in"},{"speaker":"Patrick","startTime":3120.66,"endTime":3124.83,"body":"front of the mirror. That is"},{"speaker":"Patrick","startTime":3120.66,"endTime":3124.83,"body":"under conditions that are rarely"},{"speaker":"Patrick","startTime":3124.83,"endTime":3130.83,"body":"if ever encountered in practice."},{"speaker":"Patrick","startTime":3124.83,"endTime":3130.83,"body":"Yeah, so that's point 1.2 Is oh"},{"speaker":"Patrick","startTime":3130.83,"endTime":3137.1,"body":"my gosh, if you're quanti, and"},{"speaker":"Patrick","startTime":3130.83,"endTime":3137.1,"body":"are looking for a dissertation,"},{"speaker":"Patrick","startTime":3137.4,"endTime":3143.13,"body":"and our 21 application and our"},{"speaker":"Patrick","startTime":3137.4,"endTime":3143.13,"body":"row one and NRSA to get some pre"},{"speaker":"Patrick","startTime":3143.13,"endTime":3148.23,"body":"doctoral funding, the ground is"},{"speaker":"Patrick","startTime":3143.13,"endTime":3148.23,"body":"littered with shiny objects to"},{"speaker":"Patrick","startTime":3148.23,"endTime":3152.19,"body":"go pick up and look at what do"},{"speaker":"Patrick","startTime":3148.23,"endTime":3152.19,"body":"you do with missing data? How do"},{"speaker":"Patrick","startTime":3152.19,"endTime":3155.94,"body":"you extend this longitudinally?"},{"speaker":"Patrick","startTime":3152.19,"endTime":3155.94,"body":"How would you extend this across"},{"speaker":"Patrick","startTime":3155.94,"endTime":3161.28,"body":"multiple groups? This is a"},{"speaker":"Patrick","startTime":3155.94,"endTime":3161.28,"body":"fertile ground for novel"},{"speaker":"Patrick","startTime":3161.28,"endTime":3164.82,"body":"generative work. And Ken is"},{"speaker":"Patrick","startTime":3161.28,"endTime":3164.82,"body":"really wonderful in both his"},{"speaker":"Patrick","startTime":3164.82,"endTime":3169.95,"body":"2017 and also 2021 paper, he"},{"speaker":"Patrick","startTime":3164.82,"endTime":3169.95,"body":"identifies a lot of these"},{"speaker":"Patrick","startTime":3169.95,"endTime":3173.91,"body":"things, not only are there"},{"speaker":"Patrick","startTime":3169.95,"endTime":3173.91,"body":"analytic developments that can"},{"speaker":"Patrick","startTime":3173.91,"endTime":3178.68,"body":"be done, there are simulation"},{"speaker":"Patrick","startTime":3173.91,"endTime":3178.68,"body":"work that can be done. But"},{"speaker":"Patrick","startTime":3178.68,"endTime":3183.09,"body":"there's also a real opportunity"},{"speaker":"Patrick","startTime":3178.68,"endTime":3183.09,"body":"for substantive dissemination"},{"speaker":"Patrick","startTime":3183.09,"endTime":3187.47,"body":"work. And so if your quantity"},{"speaker":"Patrick","startTime":3183.09,"endTime":3187.47,"body":"but in primarily a substantive"},{"speaker":"Patrick","startTime":3187.5,"endTime":3191.76,"body":"field, doing a compare and"},{"speaker":"Patrick","startTime":3187.5,"endTime":3191.76,"body":"contrast, and how would you do"},{"speaker":"Patrick","startTime":3191.76,"endTime":3195.66,"body":"this, Zack Fisher, Zack is"},{"speaker":"Patrick","startTime":3191.76,"endTime":3195.66,"body":"awesome in collaboration with"},{"speaker":"Patrick","startTime":3195.66,"endTime":3199.23,"body":"Canon as group but Zack really"},{"speaker":"Patrick","startTime":3195.66,"endTime":3199.23,"body":"was the workhorse on this. This"},{"speaker":"Patrick","startTime":3199.23,"endTime":3203.19,"body":"is Zach's package, he has"},{"speaker":"Patrick","startTime":3199.23,"endTime":3203.19,"body":"written a package in order that"},{"speaker":"Patrick","startTime":3203.19,"endTime":3207.45,"body":"automates everything that we've"},{"speaker":"Patrick","startTime":3203.19,"endTime":3207.45,"body":"just talked about. He has used"},{"speaker":"Patrick","startTime":3207.51,"endTime":3212.85,"body":"notation that mimics Lavon. So"},{"speaker":"Patrick","startTime":3207.51,"endTime":3212.85,"body":"if you know with Lavon, you can"},{"speaker":"Patrick","startTime":3212.85,"endTime":3216.45,"body":"do this, but the package is"},{"speaker":"Patrick","startTime":3212.85,"endTime":3216.45,"body":"called MIB SEM, we will put a"},{"speaker":"Patrick","startTime":3216.45,"endTime":3219.87,"body":"link to it on the show notes,"},{"speaker":"Patrick","startTime":3216.45,"endTime":3219.87,"body":"he's written a paper, there's"},{"speaker":"Patrick","startTime":3219.87,"endTime":3224.31,"body":"the usual documentation on it."},{"speaker":"Patrick","startTime":3219.87,"endTime":3224.31,"body":"And so well done. Zakat is"},{"speaker":"Patrick","startTime":3224.34,"endTime":3228.48,"body":"elegant, it's beautiful, it's"},{"speaker":"Patrick","startTime":3224.34,"endTime":3228.48,"body":"efficient, and I highly"},{"speaker":"Patrick","startTime":3228.48,"endTime":3229.83,"body":"recommend you look at that."},{"speaker":"Greg","startTime":3231.9,"endTime":3235.08,"body":"Most impressive, that's"},{"speaker":"Greg","startTime":3231.9,"endTime":3235.08,"body":"huge to be able to put this in"},{"speaker":"Greg","startTime":3235.08,"endTime":3238.26,"body":"the hands of the applied user."},{"speaker":"Greg","startTime":3235.08,"endTime":3238.26,"body":"And what I hope that we have"},{"speaker":"Greg","startTime":3238.26,"endTime":3241.95,"body":"done and when I say we it's like"},{"speaker":"Greg","startTime":3238.26,"endTime":3241.95,"body":"a lowercase w here, because"},{"speaker":"Greg","startTime":3241.95,"endTime":3243.75,"body":"you've done the lion's share of"},{"speaker":"Greg","startTime":3241.95,"endTime":3243.75,"body":"the work here, which I"},{"speaker":"Greg","startTime":3243.75,"endTime":3246.81,"body":"appreciate. You've opened the"},{"speaker":"Greg","startTime":3243.75,"endTime":3246.81,"body":"door for people out there, we"},{"speaker":"Greg","startTime":3246.81,"endTime":3249.18,"body":"don't expect that at the end of"},{"speaker":"Greg","startTime":3246.81,"endTime":3249.18,"body":"this, you understand all the"},{"speaker":"Greg","startTime":3249.18,"endTime":3253.68,"body":"nuances associated with MIB two"},{"speaker":"Greg","startTime":3249.18,"endTime":3253.68,"body":"as socialism, but that you know"},{"speaker":"Greg","startTime":3253.68,"endTime":3256.23,"body":"that it is there and you say to"},{"speaker":"Greg","startTime":3253.68,"endTime":3256.23,"body":"yourself, oh, you know, I have"},{"speaker":"Greg","startTime":3256.23,"endTime":3259.14,"body":"some of these problems. I have"},{"speaker":"Greg","startTime":3256.23,"endTime":3259.14,"body":"some concerns about this, this"},{"speaker":"Greg","startTime":3259.14,"endTime":3261.48,"body":"is an option for you. And we"},{"speaker":"Greg","startTime":3259.14,"endTime":3261.48,"body":"hope that you might choose to"},{"speaker":"Greg","startTime":3261.48,"endTime":3264.45,"body":"open that door and go in there"},{"speaker":"Greg","startTime":3261.48,"endTime":3264.45,"body":"yourself and find this very,"},{"speaker":"Greg","startTime":3264.45,"endTime":3266.88,"body":"very useful tool for your"},{"speaker":"Greg","startTime":3264.45,"endTime":3266.88,"body":"modeling needs."},{"speaker":"Patrick","startTime":3266.97,"endTime":3270.21,"body":"And you know, what I'd"},{"speaker":"Patrick","startTime":3266.97,"endTime":3270.21,"body":"love to see a lot of the"},{"speaker":"Patrick","startTime":3270.21,"endTime":3273.93,"body":"literature up to this point has"},{"speaker":"Patrick","startTime":3270.21,"endTime":3273.93,"body":"been to stage least squares as a"},{"speaker":"Patrick","startTime":3273.93,"endTime":3278.13,"body":"replacement for maximum"},{"speaker":"Patrick","startTime":3273.93,"endTime":3278.13,"body":"likelihood. There is no reason"},{"speaker":"Patrick","startTime":3278.13,"endTime":3280.59,"body":"at all that you couldn't"},{"speaker":"Patrick","startTime":3278.13,"endTime":3280.59,"body":"estimate your model using"},{"speaker":"Patrick","startTime":3280.59,"endTime":3284.22,"body":"maximum likelihood estimate your"},{"speaker":"Patrick","startTime":3280.59,"endTime":3284.22,"body":"model using two stage least"},{"speaker":"Patrick","startTime":3284.22,"endTime":3289.32,"body":"squares and compare and contrast"},{"speaker":"Patrick","startTime":3284.22,"endTime":3289.32,"body":"the results as another form of"},{"speaker":"Patrick","startTime":3289.32,"endTime":3293.28,"body":"sensitivity analysis. Yeah,"},{"speaker":"Patrick","startTime":3289.32,"endTime":3293.28,"body":"which conclusions are robust,"},{"speaker":"Patrick","startTime":3293.4,"endTime":3297.36,"body":"exactly what is robust and if"},{"speaker":"Patrick","startTime":3293.4,"endTime":3297.36,"body":"there is no difference between"},{"speaker":"Patrick","startTime":3297.36,"endTime":3300.42,"body":"the two? Well, then you can pick"},{"speaker":"Patrick","startTime":3297.36,"endTime":3300.42,"body":"the one you have greatest"},{"speaker":"Patrick","startTime":3300.42,"endTime":3303.81,"body":"confidence in and footnote the"},{"speaker":"Patrick","startTime":3300.42,"endTime":3303.81,"body":"other to the reader, we re"},{"speaker":"Patrick","startTime":3303.81,"endTime":3306.78,"body":"estimated the model using full"},{"speaker":"Patrick","startTime":3303.81,"endTime":3306.78,"body":"information, maximum likelihood"},{"speaker":"Patrick","startTime":3306.78,"endTime":3309.84,"body":"theory and blah, blah, blah, no"},{"speaker":"Patrick","startTime":3306.78,"endTime":3309.84,"body":"substantive conclusions were"},{"speaker":"Patrick","startTime":3309.84,"endTime":3314.1,"body":"different. But like any"},{"speaker":"Patrick","startTime":3309.84,"endTime":3314.1,"body":"sensitivity analysis, if you"},{"speaker":"Patrick","startTime":3314.1,"endTime":3318.99,"body":"find a difference between those"},{"speaker":"Patrick","startTime":3314.1,"endTime":3318.99,"body":"two, it's on you to delve deeper"},{"speaker":"Patrick","startTime":3318.99,"endTime":3323.67,"body":"into say, Well, why what is the"},{"speaker":"Patrick","startTime":3318.99,"endTime":3323.67,"body":"source of that difference? So I"},{"speaker":"Patrick","startTime":3323.67,"endTime":3327.81,"body":"love this. I love the weather"},{"speaker":"Patrick","startTime":3323.67,"endTime":3327.81,"body":"least squares as the spinning"},{"speaker":"Patrick","startTime":3327.81,"endTime":3332.79,"body":"hook kick, or is the Empire"},{"speaker":"Patrick","startTime":3327.81,"endTime":3332.79,"body":"Strikes Back for you, in your"},{"speaker":"Patrick","startTime":3332.79,"endTime":3339.48,"body":"clan? Know what's out there,"},{"speaker":"Patrick","startTime":3332.79,"endTime":3339.48,"body":"have it in your back pocket at a"},{"speaker":"Patrick","startTime":3339.48,"endTime":3342.45,"body":"cocktail party, when somebody"},{"speaker":"Patrick","startTime":3339.48,"endTime":3342.45,"body":"says, well, there's no reason to"},{"speaker":"Patrick","startTime":3342.45,"endTime":3345.27,"body":"use anything other than maximum"},{"speaker":"Patrick","startTime":3342.45,"endTime":3345.27,"body":"likelihood and to say, Well,"},{"speaker":"Patrick","startTime":3345.3,"endTime":3347.67,"body":"really, you know, and annoy"},{"speaker":"Patrick","startTime":3345.3,"endTime":3347.67,"body":"them. Because that's the whole"},{"speaker":"Patrick","startTime":3347.67,"endTime":3350.7,"body":"point of living. Maybe you use"},{"speaker":"Patrick","startTime":3347.67,"endTime":3350.7,"body":"it in your own work. Maybe you"},{"speaker":"Patrick","startTime":3350.7,"endTime":3352.77,"body":"don't, but at least you know,"},{"speaker":"Patrick","startTime":3350.7,"endTime":3352.77,"body":"it's out there on the horizon."},{"speaker":"Greg","startTime":3352.89,"endTime":3355.11,"body":"Absolutely. All right."},{"speaker":"Greg","startTime":3352.89,"endTime":3355.11,"body":"Thanks very much."},{"speaker":"Patrick","startTime":3355.14,"endTime":3357.45,"body":"Thanks, everybody. Have"},{"speaker":"Patrick","startTime":3355.14,"endTime":3357.45,"body":"a wonderful weekend. We'll talk"},{"speaker":"Patrick","startTime":3357.45,"endTime":3358.08,"body":"to you next week."},{"speaker":"Greg","startTime":3358.17,"endTime":3365.07,"body":"All right. Take care. Bye."},{"speaker":"Greg","startTime":3358.17,"endTime":3365.07,"body":"Bye. Bye bye. Thanks so much for"},{"speaker":"Greg","startTime":3365.07,"endTime":3367.98,"body":"joining us. Don't forget to tell"},{"speaker":"Greg","startTime":3365.07,"endTime":3367.98,"body":"your friends to subscribe to us"},{"speaker":"Greg","startTime":3367.98,"endTime":3371.34,"body":"on Apple podcasts, Spotify, or"},{"speaker":"Greg","startTime":3367.98,"endTime":3371.34,"body":"wherever they go for things that"},{"speaker":"Greg","startTime":3371.34,"endTime":3374.55,"body":"are more bearable to listen to"},{"speaker":"Greg","startTime":3371.34,"endTime":3374.55,"body":"it double speed. Come on, admit"},{"speaker":"Greg","startTime":3374.55,"endTime":3377.64,"body":"it. You can follow us on Twitter"},{"speaker":"Greg","startTime":3374.55,"endTime":3377.64,"body":"where we are at quantity food"},{"speaker":"Greg","startTime":3377.64,"endTime":3380.97,"body":"pod and visit our website"},{"speaker":"Greg","startTime":3377.64,"endTime":3380.97,"body":"quantity food pod.org where you"},{"speaker":"Greg","startTime":3380.97,"endTime":3383.64,"body":"can leave us a message, find"},{"speaker":"Greg","startTime":3380.97,"endTime":3383.64,"body":"organized playlists and show"},{"speaker":"Greg","startTime":3383.64,"endTime":3386.7,"body":"notes. Listen to past episodes"},{"speaker":"Greg","startTime":3383.64,"endTime":3386.7,"body":"and other fun stuff. And"},{"speaker":"Greg","startTime":3386.7,"endTime":3389.19,"body":"finally, you can get cool"},{"speaker":"Greg","startTime":3386.7,"endTime":3389.19,"body":"quantity and merch like shirts,"},{"speaker":"Greg","startTime":3389.19,"endTime":3392.19,"body":"mugs, stickers and spiral"},{"speaker":"Greg","startTime":3389.19,"endTime":3392.19,"body":"notebooks from Red bubble.com"},{"speaker":"Greg","startTime":3392.25,"endTime":3395.43,"body":"Where All proceeds go to donors"},{"speaker":"Greg","startTime":3392.25,"endTime":3395.43,"body":"choose.org to help support low"},{"speaker":"Greg","startTime":3395.43,"endTime":3398.19,"body":"income schools, you've been"},{"speaker":"Greg","startTime":3395.43,"endTime":3398.19,"body":"listening to quantitative the"},{"speaker":"Greg","startTime":3398.19,"endTime":3400.92,"body":"podcast that listener Liz"},{"speaker":"Greg","startTime":3398.19,"endTime":3400.92,"body":"Huntley makes her infant son"},{"speaker":"Greg","startTime":3400.92,"endTime":3404.01,"body":"John listen to to help with"},{"speaker":"Greg","startTime":3400.92,"endTime":3404.01,"body":"critical pediatric development"},{"speaker":"Greg","startTime":3404.04,"endTime":3407.67,"body":"in the areas of irreverence,"},{"speaker":"Greg","startTime":3404.04,"endTime":3407.67,"body":"sarcasm, and social awkwardness."},{"speaker":"Greg","startTime":3408.48,"endTime":3411.75,"body":"Today's episode has been"},{"speaker":"Greg","startTime":3408.48,"endTime":3411.75,"body":"sponsored by the all new 2023"},{"speaker":"Greg","startTime":3411.75,"endTime":3415.62,"body":"Ford Edge, which focus groups"},{"speaker":"Greg","startTime":3411.75,"endTime":3415.62,"body":"prefer 20 to one over the Chevy"},{"speaker":"Greg","startTime":3415.62,"endTime":3419.37,"body":"collider. And by second order"},{"speaker":"Greg","startTime":3415.62,"endTime":3419.37,"body":"Taylor series approximations,"},{"speaker":"Greg","startTime":3419.46,"endTime":3423.9,"body":"helping us ignore the remainder"},{"speaker":"Greg","startTime":3419.46,"endTime":3423.9,"body":"terms since 1715. And finally,"},{"speaker":"Greg","startTime":3423.93,"endTime":3426.99,"body":"by regression trees, which given"},{"speaker":"Greg","startTime":3423.93,"endTime":3426.99,"body":"that it's just about autumn in"},{"speaker":"Greg","startTime":3426.99,"endTime":3429.3,"body":"the northern hemisphere are"},{"speaker":"Greg","startTime":3426.99,"endTime":3429.3,"body":"about to drop all those"},{"speaker":"Greg","startTime":3429.3,"endTime":3432.33,"body":"regression leaves for me to"},{"speaker":"Greg","startTime":3429.3,"endTime":3432.33,"body":"clean up and haul away. I might"},{"speaker":"Greg","startTime":3432.33,"endTime":3436.14,"body":"just need a bigger cart. This is"},{"speaker":"Greg","startTime":3432.33,"endTime":3436.14,"body":"most definitely not NPR"}]}