Econometrics
Syllabus for Fall 2015
Econ309-003(Rev. 2) MW 5:30 to 6:45 PM Econ 1002/1004 INSTRUCTOR: Dr. Dave Dixon
Econ Bldg. #2026 (505) 886-1811 ddixon@unm.edu
Office hours
11:00 AM to Noon Tue, Thu 2:30 PM to 3:00 PM Mon, Wed 4:30 PM to 5:15 PM Mon, Wed
Office hours at CAPS
10:00 AM to 11:00 AM Mon, Wed, Fri TEXTBOOK: Essentials of Econometrics, 4e
by Domodar Gujarati and Dawn Porter. McGraw-Hill Publish-ing.
Available from the bookstore or online (the 3rd edition will work). ALSO REQUIRED: iClicker (any version) available from the bookstore, or iClicker REEF smartphone app (see caution in theiClickersection be-low).
COURSE OVERVIEW
Greek oikonomí ¯a household management and Greek metrikós measuring [http://www.webster.com]. According to Webster’s, the word econometrics was coined in the early 1930s. Econometrics is built upon a foundation of probability and statistics, and is most commonly focused on quantifying economic phenomena. More broadly, however, the concepts and tools of econometrics are applied to causal, statistical and behavioral models in myriad fields. Topics in this introductory course include the econometric method, the basic probabilistic and statistical foundations of econometrics, estimation and hypothesis testing, and linear regression models. The course will rely heavily upon the statistical and mathematical prerequisites (STAT 145 and MATH 120) and will assume knowledge of basic economics (ECON 105 and 106). The principle goal of this course is familiarity with the basic concepts of econometrics and the ability to immediately interpret the output from standard econometric tools.
COURSE FORMAT
Web Enhanced Lecture: This means regular class meetings (lectures) plus Learn for home-work, communication and administration. Administration includes announcements, assignment
due dates, special readings and online discussions. Administration also includes course progress and grades. You will need your UNM NetID (login) to use Learn.
Using Learn
Go to https://learn.unm.edu/. After you login, your My Courses list should include
ECON-309-003(Fall 2015). To find out more about Learn, click the Support link in the upper right corner of your Learn page.
Introductory econometrics is, ideally, a lab course. Econometrics is a dangerous tool, however, when wielded without some mastery of the theory. Lecture time will focus on theory and inter-pretation of results. Lab time will be devoted to setting up the projects, which will be completed as homework. For this course, each student will choose a preferred software platform: Microsoft EXCEL, LibreOffice Calc, OpenOffice Calc, R, or Stata. See the section below on Software. We will discuss the software choice in the first Lab. The course will cover Chapters 1 through 8 of the textbook, touching only lightly on Chapter 7 and the second half of Chapter 5.
There will be 8 lab report assignments getting progressively more complex over the semester. The required format for the lab reports is posted on Learn. Lab assignments are also posted on Learn. Please contact me as soon as possible if you’re having any problems with the labs, with online course components, or with any of the course material.
Schedule
The official course schedule is posted in Learn and is subject to change. Check it often. There is an APPROXIMATE SCHEDULE listed elsewhere in this syllabus: this version is for early planning purposes only.
Reading
If the schedule shows reading due for a class meeting, that reading must be completed before arriving for that class. Students will be required to take an iClicker quiz in class on the reading material due that day. Taking the quiz will count toward class participation, with the actual quiz grade averaged into your overall grade for quizzes.
Labs
If the schedule shows a Lab due on a date, the Lab is due before midnight on that day. Labs turned in late will have the credit reduced by five percent for each day late (which compounds quickly - see https://en.wikipedia.org/wiki/Compound_interest). The grader may ask you to revise your report, in which case there is no late penalty, provided it is resubmitted before the next Lab is due. There really is no time to catch up in this course, so I reserve the right to drop any student with an assignment that is more than a week overdue unless that student has made other arrangements. Lab reports must be submitted as PDF documents.
Participation
Students are expected to participate in discussions, in-class problem solving and exercises, and online forums. Credit for this course includes a participation component (see COURSE REQUIRE-MENTS below), which can be either positive or negative. For example, frequent absence reduces the opportunities for participation and may result in negative participation credit. Similarly, disre-spectful conduct, either in the classroom or online, will not be tolerated and will result in negative participation credit.
Exams
In 100-200 level courses, exam questions will be nearly identical to homework problems. In 300-level courses, exam problems will be similar to homework with some expectation that the student will be able to adapt to changes in numerical values or answer components (e.g. homework asked for equilibrium quantity, exam asks for equilibrium price). In 400-level courses, exam problems will address the same topics as homework, with the expectation that students are able to extrapolate from familiar applications to similar but unfamiliar applications. I will typically warn you if something in class is likely to appear on an exam, but it is possible that something from the reading will appear on an exam that hasn’t been discussed in class.
iClicker
Students are required to have an iClicker (any version), or the iClicker GO smartphone app. The iClickers will be used to take surveys in class. iClicker use will be required for class participation. The physical iClicker is available from the bookstore.Registering your iClicker: You won’t get any credit for your clicks unless you register your iClicker. There is now a link in Learn for registering your iClicker or iClicker GO app.
Caution: the iClicker GO app uses Lobo Wi-Fi to communicate with a distant server via the UNM network and the Internet. Meanwhile, the iClicker base contacts that server via the classroom computer, the UNM network, and the Internet. That is, the iClicker GO app is affected by wi-fi availability, global network traffic, national weather patterns, and astrological convergences. Many students have used the app without difficulty, but a few have been tormented by it. Use the app at your own risk -no accommodations for app-related problems can be made.
JITT
JITT (just-in-time teaching) is way for students to have some control over the curriculum. When you do the required reading, most of what you read will be clear to you, but a few things would be clearer with some discussion. To ensure that students take responsibility for this control, you will be required to make a post to the JITT discussion board in Learnat least once each week. JITT posts can include questions or comments about the homework or an exam question, or to make constructive comments in reply to a post by another student.
ONLINE CONTENT
This course will include online content posted on Learn.Please do not leave online work to the last minute – assignments missed due to technical difficulties will receive the highest level of sympathy, but no grade allowances.
COURSE REQUIREMENTS
Grading(% of total grade)
EXAMS
3 progressive exams (not cumulative, but subsequent exams will build on the material from earlier ones.) Exam 3 is during finals week.
(33%)
LABS
8 lab assignments
Late assignments will have 5% credit reduced for each day late
(32%)
PARTICIPATION
All students are expected to participate in solving problems in class, in-class exercises, reading quizzes, and general discussions. This includes participating in JITT discussions.
(35%)
GRADING POLICY
Your total grade will be a weighted percentage (weighted as shown in the table above) and your final grade will be determined from the weighted total as shown below.
Weighted
Avg. Grade
> 95% A+
93-95% A 90-92% A-Weighted Avg. Grade 86-89% B+ 83-85% B 80-82% B-Weighted Avg. Grade 76-79% C+ 73-75% C 70-72% C-Weighted Avg. Grade 66-69% D+ 63-65% D 60-62%
D-A weighted average below 60% is a failing grade.
ACCOMMODATION STATEMENT
Accessibility Services (Mesa Vista Hall 2021, 277-3506)provides academic support to students who have disabilities. If you think you need alternative accessible formats for undertaking and completing coursework, you should contact this service right away to assure your needs are met in a timely manner. If you need local assistance in contacting Accessibility Services, see the Bachelor and Graduate Programs office.
LIBRARY AND TUTORIAL SERVICES
UNM-Main campus provides many library services and some tutorial services for distance stu-dents. For library services, go to http://www.unm.edu/libraries/ to link to a specific library or to
contact a librarian. For tutorial services, go to http://caps.unm.edu/online to explore UNM’s online services.
ACADEMIC INTEGRITY/HONESTY
The University of New Mexicobelieves that academic honesty is a foundation principle for per-sonal and academic development. All University policies regarding academic honesty apply to this course. Academic dishonesty includes, but is not limited to, cheating or copying, plagiarism (claiming credit for the words or works of another from any type of source such as print, Internet or electronic database, or failing to cite the source), fabricating information or citations, facilitating acts of academic dishonesty by others, having unauthorized possession of examinations, submit-ting work of another person or work previously used without informing the instructor, or tampering with the academic work of other students. The University’s full statement on academic honesty and the consequences for failure to comply is available in the college catalog and in the Pathfinder.
In this course you will be held to the UNM standard and more. Do not do anything that would constitute academic misconduct. There will be zero tolerance of academic misconduct, and violations will be reported to University authorities. Penalties for academic misconduct in-clude withdrawal from the course with a failing grade in addition to any penalties imposed by the University.
ELECTRONIC DEVICES IN CLASS
Laptops, tablets, smartphones, MP3 players, etc. must be used with consideration. In particular, students using laptops are encouraged to sit at the back of the lecture hall so they do not distract other students. Any student whose electronic device appears to be distracting other students will be asked to terminate use.
SOFTWARE: SPREADSHEET, R, OR STATA?
I have taught this course using both spreadsheets (Excel or LibreOffice/OpenOffice Calc) and using R. Other sections are taught using Stata. All three have advantages and disadvantages which I outline below. This semester I’m giving students the choice. You will have to choose which you will use for the duration of this course because every project builds on previous projects. The lab doesn’t have enough computers for everyone, so many students bring their own laptops. If you want to work on your project outside of lab (as all students end up doing) it will be good to have a computer with the software you need. If you don’t have one of your own, then you will be using a UNM computer. That may influence your decision, too.
• Spreadsheets – Advantages
∗ Entry-level career path: If you are planning to put your economics education to work right away, chances are your job will involve lots and lots of spreadsheets. In fact, if that’s your career path, you should already be an Excel guru and this question doesn’t even matter to you. If you are not a spreadsheet guru yet, but
decide to use spreadsheets for this course, you will learn some of the spreadsheet-ninja skills you will need someday. But don’t whine about it (see the no-whining policy below).
∗ Availability on campus: If you don’t have your own computer and will be using UNM computers outside of lab, then you’re pretty much stuck with Excel.
– Disadvantages:
∗ Expensive: Excel is expensive if you have to buy it for your own computer. UNM is making Microsoft Office 365 available to students for free this semester but I don’t know the limitations or how complicated it is to get it. Information about that will be on the Learn page when I get it from IT.
· Calc, the free LibreOffice and OpenOffice spreadsheet alternative, is nearly identical to Excel. In fact, our projects were written using LibreOffice Calc and include the (extremely minor) differences between Calc and Excel. Many ECON 309 students have done their projects using LibreOffice or OpenOffice on their Windows or Mac laptops, or even iPads. There is information on Learn for downloading LibreOffice or OpenOffice. Calc and Excel will load each others’ spreadsheets, so it’s also possible to use Calc at home and Excel in the lab. ∗ Complicated: If you’re doing something other than just arithmetic, spreadsheets
can make it very complicated. Linear regression, the main feature we will be using in this course, is especially complicated in spreadsheets. This complication makes applications brittle - they break easily if you make a minor mistake and it’s usually not clear what the mistake is.
∗ Hard to document: Because they are complicated, spreadsheets are also hard to document. Why does this matter? Because it’s not possible to just look at the spreadsheet and see what it’s doing (as compared to what it’ssupposed to do). That means you, or another spreadsheet guru, has to mouse and cursor around the spreadsheet to see every calculation.
• R
– Advantages
∗ Free: R is the premier free software for statistical and econometric applications as well as high-quality graphing.
∗ Advanced career path: If you are planning to do graduate studies in economics or a related field, chances are you’ll encounter R again. Knowledge of R will be an asset for most careers that require a graduate degree.
∗ Easy to document: R is a procedural language (a step-by-step computer pro-gram). That means that you, or someone else who understands R, just has to read the file (usually 10 to 20 lines) to see exactly what it’s doing.
– Disadvantages
∗ It’s a computer language: Though much less complicated than spreadsheets for linear regressions, you have to do a few things to set up a program (4 or 5 lines in your R file) that you don’t have to do in a spreadsheet. So there’s a learning curve (though many students find it easier then what we’ll be doing in spreadsheets).
∗ Not generally available on UNM computers: I had to make a special request to get R on our lab computers. You can download and install R on your own computer(s) from http://www.rstudio.com/products/rstudio/download/. But it’s not available on all UNM computers (although it is available on some). It is possible, however, to set up a USB drive to run R on any computer. I will put that information on our Learn page if it’s something you want to try.
• Stata
– Advantages
∗ Advanced studies: Economics graduate courses at UNM (and elsewhere) use Stata.
∗ Advanced career path: Stata is the semi-official econometrics tool of the eco-nomics profession.
∗ Easy to document: Stata is a procedural language (a step-by-step computer pro-gram). That means that you, or someone else who understands Stata, just has to read the file (usually 20 to 50 lines) to see exactly what it’s doing.
– Disadvantages
∗ Expensive: Stata is expensive if you have to buy it for your own computer ($1200 to $1700). There is a six-month student edition available for $38 (seehttp://www. stata.com/order/new/edu/gradplans/student-pricing/).
∗ Complicated: Stata was developed in the early days of computers, and it has a very old-school feel. It’s hard to remember commands, hard to guess them, and the documentation, though there’s plenty of it, is hard to use.
∗ Not generally available on UNM computers: Stata is available on all the comput-ers in the Econ pod.
REAL WORLD DATA
The data sets used in exercises for this course come from textbook authors who have selected them for a specific reason: they work. Some students ask to do a project using real-world data, and I remind them of what Josiah Stamp (appointed director of the Bank of England in 1928) once said: "The government are very keen on amassing statistics. They collect them, add them, raise them to the nth power, take the cube root and prepare wonderful diagrams. But you must never forget that every one of these figures comes in the first instance from the village watchman, who just puts down what he damn pleases."
NO WHINING
The top three whines of ECON 309 students are: 1. We didn’t learn this in STAT 145
3. My laptop was: stolen / traded for meth by my roommate / peed on by my cat / really my little sister’s and she took it back
As far as STAT 145 is concerned, I’ve put a link on our Learn page to the STAT 145 web page where you can see the syllabi and previous exams. It’s all in there. That you chose to completely forget it after taking the class was a personal decision that, I hope, you now regret. At any rate, it’s not my problem, it’s yours. This course begins with a review of that material, but it is intended as
a review. If you have difficulty with the probability and statistics we cover, it is your responsibility to get help from CAPS, the econ tutors, a graduate student, another professor, or even schedule time to come to my office hours. Office hours are the loneliest time of my life, and it would brighten my day to help you with statistics, butyouhave to make it happen.
Excel (or any other software) is also not my problem. I am giving students the choice to use a spreadsheet, R, or Stata for this course (see that section above). I will provide all the support you want to write, debug, and interpret your projects, but problems with software are never an acceptable excuse for a late assignment. Period. You know yourself - if you tend to have problems with software, do the projects earlier rather than later, and schedule time to come to my office. No whining.
Problems with your personal computer or computers in UNM labs are frustrating, but there’s nothing I can do about them. There is something you can do, however. First, back up your work. You have some file space on Learn, for example. Use it. That way, when the dog eats your laptop, you just have to walk 25 miles through the blizzard, hiding from the werewolves and dodging the zombies, to a UNM computer pod, and continue working on your project. Your future depends on it.
IMPORTANT DATES
August 28, Friday Last day to add or change sections or grade mode September 07, Monday Labor Day (no class)
September 28, Monday Exam 1 November 09, Monday Exam 2
November 06, Friday Last day to drop without Dean’s permission November 25, Wednesday Thanksgiving (no class)
December 04, Friday Last day to drop with Dean’s permission December 09, Wednesday Exam 3 - 5:30 to 7:30 PM
APPROXIMATE SCHEDULE
The following schedule is for planning purposes only. The Calendar in Learn is the official schedule for this course.
Date Topic
Reading Due (before
class)
Lab Report (before midnight) Mon 17 Aug intro to this course / econometrics Ch 1
Wed 19 Aug methodology / terms and concepts Mon 24 Aug samples / random variables /
probability density App A
Wed 26 Aug Lab 1
Mon 31 Aug mean / variance / covariance / skew /
population App B
Wed 02 Sep Lab 2
Sat 05 Sep Lab 1
Mon 07 Sep no class - Labor Day
Wed 09 Sep normal / t / chi-squared / f distributions App C
Sat 12 Sep Lab 2
Mon 14 Sep Lab 3
Wed 16 Sep inference / estimators / hypothesis
testing App D
Sat 19 Sep Lab 3
Mon 21 Sep Lab 4 Wed 23 Sep review
Sat 26 Sep Lab 4
Mon 28 Sep Exam 1 - App A, B, C, & D
Wed 30 Sep linear regression / stochastic error Ch 2 Mon 05 Oct Lab 5
Wed 07 Oct ordinary least squares (OLS)
Sat 10 Oct Lab 5
Mon 12 Oct OLS 2
Wed 14 Oct OLS properties Ch 3
Mon 19 Oct OLS hypothesis testing / R-squared Wed 21 Oct Lab 6
Mon 26 Oct multiple variable models Ch 4
Wed 28 Oct adjusted R-squared
Sat 31 Oct Lab 6
Mon 02 Nov Lab 7 Wed 04 Nov review
Sat 07 Nov Lab 7
Mon 09 Nov Exam 2 - Ch 2, 3, & 4
Wed 11 Nov log-linear / polynomial models Ch 5 Mon 16 Nov Lab 8A
Wed 18 Nov dichotomous variables / seasonal
analysis Ch 6
Date Topic
Reading Due (before
class)
Lab Report (before midnight) Wed 25 Nov no class - Thanksgiving
Mon 30 Nov advanced techniques Lab 8
Wed 02 Dec review
Wed 09 Dec Exam 3 - 5:30 to 7:30 PM Ch 5 & 6
