Introduction to Econometrics
Econ 322
Fall, 2010
Lecture 12: Simple Linear Regression IV
October 13, 2010
1 / 20
Topics Covered
Topics Covered
What if X is a binary
variable?
Determining Performance
o
Introduction to Econometrics
Econ 322
Fall, 2010
Lecture 14: Multiple Regression
October 20, 2010
1 / 16
Topics Covered
Topics Covered
The General Linear
Regression Model
The Least Squares
Estimator f
Adam Smith (1723-1790)
Adam Smith's chief contribution was to build a coherent and logical theory of how the economy
works. The elements of Smith's theory were mostly already available in the writings
Gary Stanley Becker (1930 - )
Economics and Sociology
Becker repeatedly applies the tools of rational choice to analyze sociological issues that
were traditionally regarded as outside economics.
Inves
The Rise of Demand in Classical Theories of Value: Bentham, Mill, Dupuit
Jeremy Bentham (1748-1832)
The idea of utility maximization: Choices must be based on utility
maximization. Bentham provided th
Economics and Politics
James Buchanan (1919- )
Buchanan is regarded as one of the founders of public choice theory, which seeks to
analyze politics with the methods of economics. The main idea is that
Richard Cantillon
The classical school is distinguished by its focus on the macroeconomic interconnections
between different sectors of the economy, such as farmers, landowners and
manufacturers. This
Antoine Augustin Cournot (1801-1877)
Cournot pioneered the modern price theory for industries consisting of profit maximizing
firms.
He introduced differential calculus and the associated mathematics
Irving Fisher (1867-1947)
The Rate of Interest, 1907
The Theory of Interest, 1930
The Purchasing Power of Money, 1911
Mathematical Investigations in the Theory of Value
and Prices, 1925
He showed that
John Kenneth Galbraith (1908-2006)
Countervailing Power. Galbraith argued that capitalism does not lead to greater and
greater levels of competition among producers. Instead, it leads to the gradual e
Game Theory
Game theory looks at rational behavior when each decision makers well-being depends
on the decisions of others as well as her own.
Game theory consists of cooperative and non-cooperative g
LECTURE NOTES ECO 54 UDAYAN ROY
John Maynard Keynes (1883-1946)
Significance of the Great Depression for
Economic Theory
The classical or neoclassical theories implied
full-employment. (After all, if
Long Run Growth
Classical
Neo-Classical
Keynesian
Frank P. Ramsey (1903-1930)
Ramseys article A Mathematical Theory of Saving (1928) introduced the use of the
calculus of variations to growth theor
The Marginalist Era (1830-1930)
Assumption: Firms have goalsusually higher profits. Out of all the decisions a firm
could take, it will pick the one that maximizes profits.
Assumption: People have goa
LECTURE NOTES ECO 54 SPRING 2005 UDAYAN ROY
Karl Marx (1818-1883)
Marxs contributions can be
discussed under the following
sub-headings:
Theory of History
Theory of Capitalism
Formal Economics:
The Fi
Ricardos Theory of Income Distribution
Consider Table 1 below. It shows how food output on a plot of land depends on the
quality of the landtype A being the most fertile and type F being the least fer
Thomas Robert Malthus (1766-1834)
Malthus's theory of population argued that population grows at a geometric rate while food
output grows at an arithmetic rate and that food scarcity was, therefore, i
Introduction to Econometrics
Econ 322
Fall, 2010
Lecture 10: Simple Linear Regression II
October 6, 2010
1 / 14
Topics Covered
Topics Covered
The Simple Linear
Regression Model
Assumptions of the SLRM
Introduction to Econometrics
Econ 322
Fall, 2010
Lecture 21: Panel Data Methods
November 15, 2010
1 / 32
Topics Covered
Topics Covered
Panel Methods
Notation
Uses of Panel Models
Key Idea
Trac Death D
Introduction to Econometrics
Econ 322
Fall, 2010
Lecture 24: Instrumental Variables Estimation (IV) I
November 29, 2010
1 / 23
Topics Covered
Topics Covered
Motivation
IV in the SLRM with one
instrume
Introduction to Econometrics
Econ 322
Fall, 2010
Lecture 26: Introduction to Time Series Methods
December 6, 2010
1 / 27
Topics Covered
Topics Covered
What is a time series?
Why use time series?
New P
Introduction to Econometrics
Econ 322
Fall, 2010
Lecture 27: Introduction to Time Series Methods II
December 8, 2010
1 / 30
Topics Covered
Topics Covered
Causal Models using Time
series
When does OLS