Heteroskedasticity
Heteroskedasticity is a violation of the ordinary least-squares assumption that the variance of the regression error is constant across observations.
Also known asnon-constant variance · heteroscedasticity
FrameworkOrdinary least squares (OLS)
What it is
See it move
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A scatter chart plots regression residuals on the vertical axis against fitted values on the horizontal axis, with a horizontal reference line at zero. Instead of forming a uniform horizontal band, the scatter fans outward into a widening cone as fitted values increase — the visual signature of heteroskedasticity. This pattern shows that the error variance is not constant across observations, which makes OLS standard errors unreliable and invalidates conventional significance tests unless corrected.