endogeneity

Endogeneity occurs when an explanatory variable in a study is correlated with the error term, often because of factors like reverse causality or omitted variables. This can lead to biased or inaccurate estimates of relationships, making it hard to determine cause and effect reliably. In simple terms, it means that the variable you're studying is influenced by or influencing other factors in ways that aren't fully captured, which can distort your understanding of what really causes what. Recognizing and addressing endogeneity is crucial for producing valid and trustworthy research findings.