Variable Effect Model And Random Impacts Model

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β and β^* represent the results of fixed effect model and random effected model. var(β)-Var(β^*) is the difference of covariance matrix inn two results as above. When β=β^*, w=0; when β≠β^*, w>0 Therefore, Hausman test is W~X^2 (k) The k represents number of explanatory variables. If significance level is α, W<X_α^2(k), it is said to choose the random effect model, the other is vice versa. Now referring to our study, The comprehensive performance P is 〖y 〗_it, X_it shows different variables of ownership structure, μ_it represents error term. Confirmatory factor analysis: “Confirmatory factor analysis is a type of structural equation modeling that deals specifically with measurement models, that is, the relationship between observed…show more content…
Scholars are often used to measure the performance of indicators including ROE and s ' Q Tobin, ROE is the net assets yield; Tobin 's Q (= the market value of the company / asset replacement cost) is used by foreign scholars of the index, the index is reverse (Chen Goh, 2005). Referring to the market value of a company, because of the special nature of the securities market and the ownership structure of the commercial banks, the domestic scholars generally not used. And just use these two single indicators not fully reflect the business objectives of the commercial banks’ needs, nor it is suitable for the measurement of the operational performance of China 's commercial banks. This paper uses commercial banks ' net assets yield (X1), earnings per share (X2), liquidity ratio (X3), loan to deposit ratio (x4), non-performing loan ratio (x5), the capital adequacy ratio (x6), the main business income growth rate (X7), net profit growth rate (x8), total assets growth rate (x9), nine specific indicators to measure explained variables, which as the comprehensive performance of the commercial banks. Because the four aspects of the nine indicators were reflected in the executive level of financial banks "profitability", "liquidity", "debt paying ability" and "growth" and on the performance of commercial
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