= Homoskedasticity = '''Homoskedasticity''' means that the variance of the error term is constant and not correlated to any predictors. <> ---- == Meaning == Mathematically, homoskedasticity and [[Statistics/Exogeneity|exogeneity]] together can be expressed as: {{attachment:exo.svg}} The full set of variables is independently and normally distributed about 0. The covariance matrix is fully expressed as the [[LinearAlgebra/SpecialMatrices#Diagonal_Matrices|diagonal matrix]] of each term's variance. The opposite condition is '''heteroscedasticity'''. It can also be useful to express exogeneity as a [[Statistics/ConditionalExpectations|conditional expectation]] like: {{attachment:cond.svg}} ---- CategoryRicottone