Transformation of variables and the condition number in ridge estimation Salmerón Gómez, Román García Pérez, José García García, Catalina López Martín, María Del Mar Collinearity Ridge Regression Condition Number Econometric Models Ridge estimation (RE) is an alternative method to ordinary least squares (OLS) estimation when collinearity is detected in a linear regression model. After applying RE, it is sensible to determine whether such collinearity has been mitigated. The condition number (CN) is a commonly applied measure to detect the presence of collinearity in econometric models, but to the best of our knowledge, it has not been extended to be applied after RE. In OLS estimation, Belsley et al. (Regression diagnostics: identifying influential data and sources of collinearity, Wiley, New York, 1980) established that the regressors must be of unit length and not centered to correctly calculate the CN. This paper reviews this requirement in the context of RE and presents an expression to calculate the CN in RE. 2024-02-22T13:16:13Z 2024-02-22T13:16:13Z 2017 info:eu-repo/semantics/article Published version: Salmerón, R., García, J., García, C. et al. Transformation of variables and the condition number in ridge estimation. Comput Stat 33, 1497–1524 (2018). https://doi.org/10.1007/s00180-017-0769-4 https://hdl.handle.net/10481/89483 10.1007/s00180-017-0769-4 eng http://creativecommons.org/licenses/by-nc-nd/4.0/ info:eu-repo/semantics/openAccess Attribution-NonCommercial-NoDerivatives 4.0 Internacional Springer Nature