Using E-Views 9, I ran the ARDL test, resulting in an R-Squared value in the initial ARDL model output and an R-Squared value under the Bounds test. so, what is the difference between these two R squared values?
Dear Mohammed Asil
The difference between R squared in the ARDL model and R squared in the bounds test is that R squared in the ARDL model is about the rubostness of the overall model result and not about the robustness of the bounds test result only. This means R squared in the ARDL model will tell you how much the variability in Y or Ys (your dependent variable/variables) is/are explained by the ARDL model given Xs variables (your independent variables). On the other hand, R squared in the bounds test is specifically about the bounds test result within the ARDL model and not about the robustness of the overall model result. You need an ARDL model first to have a bounds test but not a bounds test to have the ARDL model. I hope it helps you.
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