Econometrics Notes from

# Econometrics Notes from - A model must be constructed to...

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Econometrics Notes from “A Concise Introduction to Econometrics I. Introduction a. I will answer practical questions by inserting data into an economic model i. b. The goal is to translate practical questions into an econometric model c. A key activity of econometricians involves finding the right model for the provided data i. Parameter estimation; parameters are found by inserting data into model ii. Answers involve a level of ‘confidence’ rather than yes/no d. Implementing model outcomes: constructing forecasts e. Summary: Economic insights and mathematical language is used to construct the econometric model . Statistical techniques are used to analyze its properties . f. There is no given model at the outset of a problem

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Unformatted text preview: . A model must be constructed to interpret the data. i. Specify the model ii. Evaluate the model iii. Implement the model II. Basic Concepts and Tools i. Distribution – the spread of data ii. Linear Regression 1. Some model Y i =B o +B 1 x i +U e a. Y is the dependent variable, since we need to plug in x (the given data) to reach a conclusion b. B i is a constant that addresses some aspect of the model and usually B i ’s need to be estimated c. U e is the residual, some aspect of Y that the model cannot account for through calculating x i iii. After gathering sample data, the purpose is to estimate the parameters and assign a confidence interval for the estimates....
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Econometrics Notes from - A model must be constructed to...

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