writing an empirical research report, and sources of ... · share prices. – journal data and ......

Writing an Empirical Research Report, and

Sources of Economic Data

2

Select an area of interest and identify a problem you wish

to work on.

Find suitable and readily available data.

Learn the econometric procedures that are appropriate for

analyzing the data, and implement them on the computer.

Principles of Econometrics, 3rd Edition Slide 17-2

3

1. Short Statement of the Problem

2. Review of the Literature

3. The Econometric Model

4. The Data

5. The Estimation and Inference Procedures

5. The Empirical Results and Conclusions.

6. Possible Extensions and Limitations of the Study

7. ReferencesPrinciples of Econometrics, 3rd Edition Slide 17-3

4

1. Short Statement of the Problem

2. Review of the Literature

3. The Econometric Model

4. The Data

5. The Estimation and Inference Procedures

5. The Empirical Results and Conclusions.

6. Possible Extensions and Limitations of the Study

7. ReferencesPrinciples of Econometrics, 3rd Edition Slide 17-4

5

• Resources for Economists (RFE) [http://www.rfe.org]

– US Macro and Regional Data Here you will find links to various data sources

such as the Bureau of Economic Analysis, Bureau of Labor Statistics,

Economic Reports of the President, and the Federal Reserve Banks.

– Other US Data Here you will find links to the US Census Bureau, as well as

links to many panel and survey data sources. The gateway to US Government

agencies is FedStats [http://www.fedstats.gov/].


http://www.rfe.org/

http://www.fedstats.gov/

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– World and Non-US Data Here there are links to world data, such as the CIA

Factbook, and the Penn World Tables. International organizations such as the

Asian Development Bank, the International Monetary Fund, the World Bank,

etc.

– Finance and Financial Markets Here there are links to sources of US and

world financial data on variables such as exchange rates, interest rates and

share prices.

– Journal Data and Program Archives Some economic journals post data used

in articles.


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• http://www.econdata.net/

• http://www.feweb.vu.nl/econometriclinks/#data

• http://www.Economagic.com


http://www.econdata.net/

http://www.feweb.vu.nl/econometriclinks/

http://www.economagic.com/

8

• Statistical Resources on the Web:

http://www.lib.umich.edu/govdocs/stats.html

• Business, Financial and Economic Data:

http://www.forecasts.org/data/


http://www.lib.umich.edu/govdocs/stats.html

http://www.forecasts.org/data/

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• International Financial Statistics (IMF, monthly)

• Basic Statistics of the Community (OECD, annual)

• Consumer Price Indices in the European Community (OECD,

annual)

• World Statistics (UN, annual)

• Yearbook of National Accounts Statistics (UN, annual)

• FAO Trade Yearbook (annual).


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• Survey of Current Business (BEA, monthly)

• Handbook of Basic Economic Statistics (BES, monthly)

• Monthly Labor Review (BLS, monthly)

• Federal Reserve Bulletin (FR, monthly)

• Statistical Abstract of the US (BC, annual)

• Economic Report of the President (annual)

• Agricultural Statistics (USDA, annual)

• Agricultural Situation Reports (USDA, monthly)

• Economic Indicators (Council of Economic Advisors, monthly).Slide 17-10

11

• State of California

• US Department of Labor (BLS)

• US Department of Commerce

• Federal Reserve

• Other People’s Papers

Slide 17-11

Selecting a Topic

• Select an area of interest and identify a problem you

wish to work on.

• VERY IMPORTANT: you should be curious

about this!!!

• EQUALLY IMPORANT: have something to

say!!!

Principles of Econometrics, 3rd Edition 12

Selecting a Topic

• Any relationship can be studied:

– Economic (wages, sales, GDP, real estate, prices,

costs, etc.)

– Sociological

– Educational

– Demographic

Look at GRETL Topics


Selecting a Topic

• Consider not just a topic, but a problem (or a

question)!


Selecting a Topic

• Use other people’s research to frame your

topic.

– Google Scholar

– J Stor

– Textbooks that cover topic


Selecting a Topic

• Target Date: November 5th

• Come to my office hours

• Use ME!!!


Subject Areas

• Crime

• Demographics

• Education

• Energy

• Entertainment

• Family

• Government

• Health

• Investments

• Macroeconomics

• Real Estate

• Retail

• Travel and Leisure

• Everything else!


Topic Ideas

• Crime

– Why do some cities have

more crime?

– Is mix of crime

changing?

• If so, what are the factors

which affect the change?

– What’s the effect of

income on crime?

– What’s the effect of

education on crime?

• Crime

– Has crime risen or fallen

during the recession?

– Have property crimes

risen or fallen during the

recession?


Topic Ideas

• Demographics

– How does income affect

population growth?

• Depression = baby bust

• Post WW2 = baby boom

• 70s = baby bust

• 80s/90s = new baby boom

– What factors keep US

population growing (vs.

other industrialized

countries)?

• Demographics

– How does immigration

affect:

• Wages?

• Local economies?

• National economy?

– Why do the patterns of

population growth vary?

• State by state

• Urban vs. Suburban


Topic Ideas

• Education

– Who gets into what

colleges? Why?

– How does income impact

education?

– How does education

impact income?

– Do test scores predict

educational success?

– What’s the impact of a

parent’s education?

• Energy

– How does weather affect

energy consumption?

– Does competition affect

gas prices?

– What’s the elasticity of

demand for gasoline?

– How do high mileage

cars affect gas sales?

– How do gas prices affect

public transit usage?


Topic Ideas

• Entertainment

– How have TV viewing

habits changed?

– How have reading habits

changed?

• Why do some newspapers

succeed and others fail?

• Why are some magazines

successful?

• How does readership

change state by state or

city by city?

• Entertainment

– How has the recession

affected movie, music

and sports events?

– Do sports teams benefit a

city’s economy?

– What’s the impact of the

internet on movies?

– What happens to

advertising revenues in a

recession?


Topic Areas

• Family

– How has the family

structure changed?

– What are the

determinants of these

changes?

– How does family

structure affect education

and income?

– What are the causes of

family poverty?

• Government

– How has tax revenue

fared during the

recession?

– What determines of the

level of taxes?

– Do regulations inhibit

businesses?

– How does Fed policy

affect the economy?

– Does tax avoidance vary

between nations?Principles of Econometrics, 3rd Edition 22

Topic Ideas

• Health

– Why do health outcomes

vary by population

group?

– How does education and

income affect health?

– How does where you

live affect your health?

– Does more health

spending lead to better

outcomes?

• Investments

– How do stock market

changes track with--

• The economy

• Bond prices

• Interest rates

• Democratic vs.

Republican presidents

• Exogenous events (e.g.,

disasters, wars, etc.)

• Inflation


Topic Ideas

• Macroeconomic

– Do low interest rates

mean more growth?

– What is the affect of

increased government

spending on growth?

– Do tax cuts raise income

(Laffer Curve)?

– Do tax increases retard

growth?

• Real Estate

– What factors explain the

housing meltdown?

– How have rental

properties/development

fared during the housing

bubble & meltdown?

– What factors explain the

meltdown in commercial

properties?


Topic Ideas

• Retail

– How have retailers fared

during the recession?

– What explains the

differences?

• Upscale?

• Majors (Wal-Mart,

Costco, Target)?

• Dollar Stores?

• Supermarkets?

• Retail

– How does the internet

affect retail?

– How haves internet

companies done during

the recession?

– How do retail sales vary

by region? Population

group? Income group?


Topic Ideas


– How has the recession

affected leisure

spending?

– Has spending on

“luxury” gone up?

– Where do tourists to

California come from?

Why?

– How do exchange rates

affect international

travel?


– Have patterns of

vacation spending

changed during the

recession?

• Do high energy prices

keep people at home?

– Disneyland vs. Disney

World vs. Euro Disney?

• How have attendance

changed during the last 5

years and why?


Everything else!!!

• Automobiles (repairs, buyers), Babies (weight, health, teenage mothers), Computers

(sales, changes with internet), Dogs and Cats (pet population, who prefers what

kind of pet), Examinations (Bar, CPA, Med Boards, results by gender, schools

attended, etc.), Food (changing eating habits), GPAs (what affects them), Hospitals

(patient days, emergency room usage), International Trade (growing, changing,

why?), Jersey Shore (why are “reality” shows popular?) Kindle vs. iPad vs.

Chromebooks (who’s winning, why), Longevity (improvements, explanations),

Men (changes in labor participation), Nations (comparison of growth and taxes),

Obama (approval, election projections), Poverty (rates by city, county, state),

Quality (air, water), Retirement (postponement due to the economy), States (causes

of deficits), Taylor Swift (who likes her), USA (everything), Vegans (changing

eating habits), Women (decisions to have children, health), Xenophobia (affected by

location, unemployment), Youth (crime, unemployment), Zero [near] rates (Fed

policy).


The Structure of the Project

• The paper should be 2 - 3 typed pages in length (700 - 1000

words) and should contain:

– Introductory paragraph presenting your model and

stating the question/problem you are examining. It should

also include a comment about what you expect to find (i.e.,

how you expect the independent variables will relate to the

dependent variable).

– Short description of where you found your data (sources).

– A paragraph or two discussing the different regressions

you ran and why you eliminated or changed independent

variables (i.e., they were insignificant).


The Structure of the Project

– A paragraph discussing issues, such as irrelevant

variables, multicollinearity or heteroskedasticity. If you

detected problems, how did you try to address them?

– A paragraph or two of results. Explain what variables

were found to be significant. Make sure you say something

about the major statistics that were covered in the course

(R2, t tests, F test). Also, interpret the data (i.e., for every

additional year of education, average income rises $1550

per year).

– A summary comment: what your work shows and ideas

for further research.


Structure of the Project

• As for the actual data and the analysis:

– Start with at least 5 - 6 independent variables

– Make sure at least one is a dummy variable

– Run at least 3 - 4 different regressions, in which

you:

• Eliminate variables

• Test various “functional forms” such as logs or

quadratics.


What you will submit

• The final submission will include:

– The 2 - 3 page write-up.

– At least 3 or 4 different regressions (so I can

follow the steps you took)

– Your data in an Excel or other file (so I can

replicate your work)


Goals and Grades

• The goals of the project are to:

– Experience “doing research.”

– Experience “running regressions” and using Gretl

to come up with results.

– Demonstrate a good grasp of the major concepts of

the course.


How you write-up the Project

Begin with a paragraph about what you’re doing:

. . . examining the relationship of health

outcomes to income, education and . . .

This project looks the relationship between

interest rates and national income,



MAKE SURE IT MAKES SENSE!!!!

Remember: econometrics employs economic theory,

knowledge of human behavior and real-world

experience.

Use that in your write-up.



Include comments about what you might expect

from the data.

-- pay close attention to signs



• Then you need the model.

INTERESTRATE = b1 + b2INCOME +

b3QUANTITY$ + ….



• And you need to define the variables

– Poverty % of people under the poverty line

– Income per capita income (000)

– Education % high school graduates

– Gender 1 = female, 0 = male

– ……



• You need a separate section (very short)

describing where the data comes from:

– College websites

– Government sources

– Survey

– County websites



• The you run regressions and talk about them!

– Start with all your variables

– Tell me about R2, F test and significance levels

– Any suggestions of multicollinearity?

– What about heteroskedasticity?



• Then begin to run alternative regressions,

eliminating variables and adding comments

about what you are doing.



• When you get to your final regression, discuss

its advantages:

– Better R2

– More significant variables



• Then you write a summary of what you found

and what it means.

– Implications of the coefficients

– Surprises (signs, what’s significant)


And finally, you PRESENT . . .

• The Project as a GROUP during the Final

period.

• Nothing too fancy . . .

– Simple slides would be good

– Everyone should try to say a few words.

• Just tell us the problem, your model, your data

sources and what you discovered.

• Take about 10 minutes.


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