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Tutorial on Using Excel to Run OLS
The objective of this reading assignment is to guide you through the mechanics necessary
to perform an OLS regression in Excel.
Obviously, the first step is to open Excel.
Assuming
Excel is open, an OLS regression is performed as follows.
Step One - Entering Data
Your data must be in columns.
The columns do not have to have a label, but labeling
your data will make reading the results easier.
Data for the independent variables must be in
adjacent columns.
It is ok to manipulate your data (such as squaring a variable), but before
running the regression, make sure all the independent variables are in adjacent columns.
The
dependent variable and independent variables do not have to be in adjacent columns.
The data set-up for this example is shown in the following figure.
The dependent variable is
labeled “output” and the independent variables are labeled “land, labor, capital.”
Create a
worksheet that has the following data as shown in the worksheet below.
The tutorial works best
if data is entered in the cells shown.
As will be shown later, you do not have to enter the column
of ones associated with the intercept.

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