by ira
Last Updated September 09, 2018 16:19 PM

Let's say I have a model like

```
A = α0 + α1*B + α2*C + α3*D + ϵ (Model 1)
```

Then I can estimate it's nested models

```
A = α0 + α1*B + α2*C + ϵ (Model 2)
```

or, say,

```
A = α0 + α1*B + ϵ (Model 3)
```

If models 2 and 3 are nested models of model 1, what is model 1 to models 2 and 3?

In other words, if i can call models 2 and 3 nested models of model 1, how would i call a model 4 (which is an extension of model 1) defined as:

```
A = α0 + α1*B + α2*C + α3*D + α4*E + ϵ (Model 4)
```

?

Are nested models just those, which are subset of some larger model, or can i call even model extensions "nested models"?

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