Currently i have the following multivariate model Y = a + bX +bZ, where Y is the dependent variable and X and Z are independent variables. I have ran a Granger Causality test, and have found that variables Y causes X and X Causes Y). The Z variable causes Y, but Y does not causes Z. I believe multivariate regression may be the wrong technique to apply in this situation, but i am not sure though. Do you guys have any suggestions?
Any help would be much appreciated!