Abstract

The main objective of this paper is to introduce a new class of estimators for the ill-conditioned beta regression model. The new class, named the Liu-ridge-type (LRT), incorporates two shrinkage parameters that allow it to include the maximum-likelihood estimator (MLE), the ridge estimator (RE), and the Liu estimator (LE) as special cases. The LRT estimator has been shown to outperform the LE, the RE, and the MLE in terms of the mean squared error (MSE) matrix under certain conditions. Simulated and real applications illustrate the potential benefits of the new LRT estimator.

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