Major Assignment

ECON3210 Section O

Laura Salisbury

Winter 2015

1 Assignment Details

Summary

You will analyze the relationship between two economic variables of interest using the toolsacquired in the course. You will identify a research question, and then identify an appropriatedata source, which you will use to answer this question. For example: What is the effect offamily size on labour supply? What is the effect of crime rates on house prices? What is theeffect of inflation on exchange rates? Your topic can cover any area of economics just picksomething you find interesting!

You may work in pairs, but you dont have to. Your topic must be approved by me aheadof time. Your assignment paper should contain all the required components listed below. Itshould not exceed 2000 words, excluding tables, figures, and references. The assignment isdue on March 19th by 11:59pm, and must be turned in via the course website. Lateassignments will be penalized according to the following rule: a paper that is D business dayslate will lose 5(ln(D) + 1) points. Assignments will not be accepted after April 6th.

Topic Approval

You and your partner (or just you if youre working alone) will sign up for a meeting with meusing the scheduler on the course website. Meetings will be 5 minutes long, and will be heldon February 2nd, February 3rd, and February 6th. We will use this meeting to discussyour topic and appropriate data sources. You should bring a short, one paragraph descriptionof your topic to this meeting include the names of both group members (if applicable) onthis sheet.

Statistical Software

You will be required to use statistical software to complete this assignment. You can use anysoftware you are comfortable with and have access to. I will be most helpful to you if you areusing Stata, since this is what I use in my own work. You will be given access to Stata throughthe undergraduate computing lab in the economics department (Vari Hall room 1059). Thislab is open from 8:30-4:30, so plan accordingly! Your York ID (the beginning of your yorkemail address) will be your user name, and your student ID number will be your password.

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If you are familiar with R, you can use this program instead it can be downloaded free ofcharge onto your personal computer.

Ideas for Data Sources

The following is a list of data sources to get you started. You do not have to use one of thesesources, but they will give you a sense of what is available:

IPUMS is a great, user-friendly source for micro-level data from all over the world:http://www.ipums.org

ICPSR is another large data source, containing data on a variety of topics from variouscountries: http://www.icpsr.umich.edu/

Statistics Canada has data on a variety of topics, aggregated to the national or provinciallevel: http://www.statcan.gc.ca/

The Bank of Canada publishes a number of aggregate statistics: http://www.bankofcanada.ca/

2 Required Components

Your assignment paper should include all of the following components. It should not exceed2000 words, excluding tables, figures and references.

Introduction

In this section, you should clearly identify the research question you are trying to answer.Why is this an interesting question? What else has been written about this question? Howdoes it relate to economics?

Description of Data

Describe your data source in detail. This involves answering the following questions:

Why is this an appropriate data source with which to answer your research question?

Which organization is responsible for the creation of your dataset? Did you mergemultiple data sources? If so, what are they?

What kind of data are you using? (i.e. cross-section, panel, time series)

How was your dataset created? (i.e. survey, administrative, etc)

What is the unit of observation in your dataset? (i.e. person, household, country,province, industry, year, etc.)

How big is your sample? Have you imposed any restrictions on your sample? What arethey?

What did you do to clean your data?

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http://www.ipums.orghttp://www.icpsr.umich.edu/http://www.statcan.gc.ca/http://www.bankofcanada.ca/http://www.bankofcanada.ca/

What are your primary variables of interest? How are they defined? Are they indicatorvariables?

What control variables are you using? How are they defined? Are they indicator vari-ables?

Are there any other unique features of your data I should be aware of? For example,are any of your variables top coded? Are any values imputed?

Econometric Model

Describe the econometric model you are using to answer your research question. This involvesanswering the following questions:

What kind of a model are you using? Which variables does it contain? Does your modelinclude any interaction variables?

Why do you think this model is appropriate for answering your research question?

What are some of the potential pitfalls associated with this model? For example, arethere omitted variables that might bias your results? Are any of your variables collinear?You should suggest an appropriate way of addressing any of the challenges with yourapproach that you identify.

What does economic theory predict about the sign or magnitude of your coefficients ofinterest?

Results

Present your results in this section. You should begin by presenting a table of descriptivestatistics for your data (such as means, standard deviations, minima and maxima for thevariables you will be using in your analysis). You may also include descriptive figures ifappropriate. Estimate your econometric model, and present the results. You should addressthe following questions:

What are you estimated coefficient(s) of interest? What do they mean?

Are your main results significant? Provide appropriate confidence intervals.

Is you model significant? Show supporting statistics.

How much explanatory power does you model have? How well does the model fit yourdata?

How sensitive are your core results to including and excluding different control variables?What does this tell you?

Is there any evidence of heteroskedasticity in your error terms? What happens whenyou estimate heteroskedasticity-robust standard errors?

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Discussion and Conclusion

Discuss the meaning of your results, with reference to your research question. Did you findwhat you had expected to find? Why or why not? Discuss any challenges there might be ininterpreting your results as causal.

List of References

All secondary sources you use during your research should be cited in your assignment paperand then included in a list of references at the end. For a guide to citation styles, see:http://researchguides.library.yorku.ca/styleguides

3 Grading Rubric

Grade Item Weight

Topic proposal & meeting 5%

Following instructions 5%

Justification of research question and appropriateness of data source 15%

Demonstrated understanding of data source 20%

Demonstrated understanding of econometric theory and methods 35%

Clarity of arguments, writing, and presentation of data 20%

4 Tips

Start early! This assignment will be time consuming, and it will be impossible to do agood job if you leave it to the last minute. Moreover, space in the computer lab is highlylimited, so you will not all be able to cram in to complete your assignment on the lastday.

Seek help! If you are having trouble doing something in Stata, or if youre having troubleinterpreting your results, ask me or the TA for help.

When choosing your topic, keep in mind that you need to be able to find adequate datato analyze. For the purposes of this course, you should have at least 100 observations inyour dataset.

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http://researchguides.library.yorku.ca/styleguides

Assignment DetailsRequired ComponentsGrading RubricTips