I was wondering what is the effect of say regressing a dependent variable that has a positive trend with an independent variable that has a downward trend?
Thanks!
Sorry what I meant was in a time series context.
Say you have this regression:
$\displaystyle y_t = b_0 + b_1 x_t$ where y_t is a positive trending time series variable and x_t is a negative trending time series data, in general would it be a good idea to add a time trend variable if the dependent variable is upwards trending and the independent variable is downwards trending? Ie, use the regression:
$\displaystyle y_t = b_0 + b_1 x_t + b_2 t$