The facility coefficient procedure is an economic coefficient
used in computing the Annual Maintenance Expenditure, by adjusting a coefficient for each of the surveyed buildings in the facility, and for the entire facility.
Although collinearity among explanatory variables does not bias OLS or tobit estimates, the state economic coefficient might have reduced the statistical importance of the county economic coefficient.
None of the 16 county economic coefficients was economically significant.
We take into account also product economic coefficients
, its outfit by accessories, spare parts etc., as well as premises, which producer creates to provide services connected to product use.
A log likelihood ratio test of the hypothesis that the economic coefficients
in models 2 or 3 are all zero is easily rejected in both cases at the 0.5% significance level.