1. A method for encoding a video signal having a plurality of frames, each frame having a plurality of blocks and an original resolution, the method comprising: identifying a first frame from the plurality of frames that is predicted using inter prediction; determining a first variance for the first frame using a processor; calculating a first peak signal to noise ratio (PSNR) for the at least one frame using the original resolution; and calculating a second PSNR for the at least one frame using a resolution lower than the original resolution for the first frame; selecting a first frame resolution from one of: (a) the original resolution or (b) the resolution lower than the original resolution for the first frame based on the first variance, the first PSNR, and the second PSNR: and encoding the first frame using the selected first frame resolution.