Introduction to Econometrics 3rd Edition by James Stock, James Stock

Exercise 16

( Y i X₁i X₂i ) satisfy the assumptions in Key Concept 6.4. You are interested in ß 1 , the causal effect of X l on Y. Suppose that X₁ and W 2 are uncorrelated. You estimate ß 1 by regressing Y onto X₁ (so that X₂ is not included in the regression). Does this estimator suffer from omitted variable bias Explain.