The Palestinian Economy. Theoretical and Practical Challenges

Proceedings “The Palestinian Economy: Theoretical and Practical Challenges” 403
5. Results
5.1. West Bank and Gaza
Overall Performance of the model
The pseudo R-square measures indicate that the model performs fairly well. The
Nagelkerke R-square value will usually be the most relevant to report .It corrects the Cox
and snell value so that it can theoretically achieve a value of 1. These pseudo R-squared
confound goodness of fit and explanatory power of the model (See Table 1). 2
Table 1: Pseudo R-Square
Cox and Snell .250
Nagelkerke .316
McFadden .184
The most interesting result here is that the chi- square value of 228315.311 with 72
degrees of freedom is highly significant, this means that the null hypothesis that all
effects of the independent variable are zero can be rejected (See Table 2).
Table 2: Model Fitting Information
Model Log Likelihood Chi-Square df Sig.
Intercept Only 644213.951
Final 415898.640 228315.311 72 .000
The likelihood ratio test evaluates the overall relationship between an independent
variable and the dependent variable. There are statistically significant relationships
between the independent variables (years of schooling, sex, age, district, locality type,
2 Cox and Snell’s R-Square is an attempt to imitate the interpretation of multiple R-Square based on the
likelihood, but its maximum can be (and usually is) less than 1.0, making it difficult to interpret.
Nagelkerke’s R-Square is a further modification of the Cox and Snell coefficient to assure that it can vary
from 0 to 1. That is, Nagelkerke’s R 2 divides Cox and Snell’s R 2 by its maximum in order to achieve a
measure that ranges from 0 to 1. Therefore Nagelkerke’s R 2 will normally be higher than the Cox and Snell
measure but will tend to run lower than the corresponding OLS R 2 .