Session_1 - Welcome to Econometrics FINN 321 Dr Salman Khan...

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Welcome to Econometrics FINN 321 Dr. Salman Khan PhD. Finance 1
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2 Why study Econometrics? Rare in economics (and many other areas without labs!) to have experimental data Need to use nonexperimental, or observational data to make inferences Important to be able to apply economic theory to real world data
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3 Why study Econometrics? An empirical analysis uses data to test a theory or to estimate a relationship A formal economic model can be tested Theory may be ambiguous as to the effect of some policy change – can use econometrics to evaluate the program
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4 Types of Data – Cross Sectional Cross-sectional data is a random sample Each observation is a new individual, firm, etc. with information at a point in time If the data is not a random sample, we have a sample-selection problem
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5
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6 Types of Data – Panel Can pool random cross sections and treat similar to a normal cross section. Will just need to account for time differences.
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This note was uploaded on 03/19/2012 for the course FINN 323 taught by Professor Salmankhan during the Spring '12 term at Alvin CC.

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Session_1 - Welcome to Econometrics FINN 321 Dr Salman Khan...

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