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Unformatted text preview: ECON 2P91: Business Econometrics with Applications Winter 2011 Lab4 The objective of this weeks labs is to demonstrate the estimation of panel regressions using both pooled OLS and Least Squares Dummy Variables. What is the price elasticity of demand for wine in Canada? To answer this question, we obtained panel data for 10 Canadian provinces each of which was observed over 22 years (1980-2001). These data are reported in the Excel data file Wineconsumption.xls . For this data set, CONS denotes the annual wine consumption (litres) per capita (15 years and over) and PRICE denotes the Consumer Price Index (CPI) for Wine (1980=100). D1, D2, D3, ..,D10 are binary variables representing the individual (provincial in this case) fixed effects. For example, D1=1 if the province is Alberta and D1=0 for all other provinces; D2=1 if the province is British Columbia and D2=0 for all other provinces....
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