Analyzing a Regression Using Data from a Sub-Sample of the Current

Essay

Analyzing a regression using data from a sub-sample of the Current Population Survey with about 4,000 observations, you realize that the regression R², and the adjusted R², $\overline { \mathrm { R } }$ ², are almost identical. Why is that the case? In your textbook, you were told that the regression R² will almost always increase when you add an explanatory variable, but that the adjusted measure does not have to increase with such an addition. Can this still be true?