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2010-01-13
EffectiveNumber: this value reflects a tradoff between the variance of the fitted values and the bias in the coefficient estimates, and is related to the choice of bandwidth. As the bandwidth approaches infinity, the geographical weights for every observation approach 1, and the coefficient estimates will be very close to those for a global OLS model. For very large bandwidths, the effective number of coefficients approaches the actual number; local coefficient estimates will have a small variance but will be quite biased. Conversely, as the bandwidth approaches zero, the geographical weights for every observation approach zero with the exception of the regression point itself. For extremely small bandwidths, the effective number of coefficients is the number observations, and the local coefficient estimates will have a large variance but low bias. The effective number is used to compute a number of diagnostic measures.
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