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Table 5 Diagnostics for Spatial Dependence: Lagrange Multiplier Tests for Error Versus LAG Dependence

From: Spatial analysis of elderly access to primary care services

Symbol

Test

Degrees of Freedom

Test statistic value

p-value

RS ρ

Lagrange Multiplier (lag)

1

1090.35

0.000

RS ρ *

Robust LM (lag)

1

173.32

0.000

RS λ

Lagrange Multiplier (error)

1

1002.00

0.000

RS λ *

Robust LM (error)

1

84.97

0.000

  1. Methodology for proper diagnosis of error process in cross section: If neither RS ρ nor RS λ are significant, but robust tests (RS ρ * RS λ *) are, then ignore the robust tests. When RS ρ is more significant (lower p-value) than RS λ , and RS ρ * is significant while RS λ * is not, then lag autocorrelation is most likely the correct error structure. When RS λ is more significant (lower p-value) than RS ρ , and RS λ * is significant while RS ρ * is not, then error autocorrelation is most likely the correct error structure. We find that RS ρ is more significant then RS λ , as it has a larger test statistic value (and the same degrees of freedom). The same is also true of the robust tests, so we conclude that a lag process is more likely than an error process in these data.