Download Project Instructions 2

Econ 301.02
Fall 2015
Instructions to 2nd Submission
This is the second time you are submitting your project. This stage is when
you are preparing for conducting the regression estimations. The next and the
3rd stage will be the final presentation of complete results.
Submission will be via TURNITIN again.
In this stage the following are the sections you are supposed to submit:
Your second assignment is to
a. revise and refine your first submitted text and
b. add further steps of your model.
-TITLE PAGE:
Follow the template given in the previous instructions. Make your font
size 12. Come up with a title relevant to your exercise.
-INTRODUCTION:
In this section introduce the topics, what are you examining. Which
relationship you are interested in. Why is this important. Have at least 2
paragraphs.
-LITERATURE REVIEW:
You should have found at least on academic paper which examined the
same/similar issue. Write about what the other researcher has done
and what is his/her conclusion about the topic that you are examining.
You should refer to this study with this format: eg. Lastname (2008).
(You are going to give the complete reference in the reference section)
-DATA:
Here you are going to state the country(ries) and the period that is
included into your analysis. What is the frequency of your data (annual
or monthly)? What are your variables, dependent and independent?
What is the definition of your data? (eg. GDP real in 2002 dollars in
terms of US dollar etc. What is your data source? Where have you
collected you data from?
For each of the variable using EVIEWS conduct the summary statistics
and report in a table, like the following:
1
Series
Y
Mean
Median
Maximum
Minimum
Std Dev.
Skewness
Kurtosis
Jarqua
Bera
Probability
X
Z
Also provide a graph of your dependent variable. You can do this using
eviews as well, draw the graph and print on a text file from PRINT
SETUP. Then you can incorporate in into you submission.
If you have multiple countries, draw multiple graphs.
-MODEL:
What is the relationship that you want to examine, write in words.
Then write the regression equation (in math editor). Explain the
expected signs for each of the coefficients and the reasons. Often the
economic theory explain the reasons.
THE NEXT STEP IS THE REGRESSION ESTIMATION AND REPORTING THAT
WILL BE DONE FOR THE FINAL SUBMISSION
I am also including below the FEEDBACK FILE that was sent previously as a
reminder:
_____________________________________________________________
General Format:
1) FOLLOW THE INSTRUCTIONS ON THE TITLE PAGE EXACTLY.
2) Please submit after a spell check.
3) Write in paragraphs and separate the sections such as introduction, data, model etc.
Do not write in bullets.
4) Write all regression equations using equation (math) editor of WORD.
5) Font should be 12 and Cambria or Times New Roman.
6) You can not have observation number less than 90.
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ECONOMICS GROWTH ANALYSIS
1) Your data set should follow the instructions given in choosing the country and period,
such as
 Choose one group from the below list:
a) OECD, b) Africa, c) Latin America, d) Asia
 Choose one period from the below list:
a) 2000-2010; b) 1990-2000 c) 1980-1990,
The project may have a title such as:
“The determinants of economic growth in Latin America in 2000-2010”
2) The growth equation should follow the below structure:
Growth = b1 + b2 Initialincome + b3Popgrowth + b4 Shareofinvestment + b5Shareofgovexpenditure +
b6 Education + others.... + u
Variables:
Growth: Percapita real GDP growth,
Initial income: Log of percapital real GDP of the first observation,
Pop growth: rate of population growth,
Share of investment: the ratio of Investment to GDP
Share of gov. expenditure: the ration of government expenditure to GDP,
Education: Primary or secondary education measure,
Other variables can be trade openness, the rule of law, democracy index, freedom of press, etc.
3) Data source: World bank, Penn world tables, Freedom House,
STOCK MARKET RETURNS AND MACROECONOMIC VARIABLES
1) In this topic you need to choose two countries, one developed and one developing, and
conduct a monthly time series analysis on the relationship between stock market
index return and various macroeconomic variables. The main equation should be:
Return = b1 + b2 %DInd Pr odindex + b3TreasuryBillrate + b4 Inflationrate +
b5 %DMonsup ply + b6 %Dexchangerate + (b6 %Doilprice) + u
2) The data source should be IFS_World Bank, the codes and titles of variables are as
follows:
Exchange rates: End-of-month price of SDR in local currency. (IFS code 00aa)
Money supply: Narrowly defined money supply (IFS code 34)
Consumer price index: Consumer price index (IFS code 64)
Industrial production index: Industrial production index (IFS code 66)
Discount rate: Discount rate (IFS code 60).
3) The explanatory variables should be used with one period lag such as:
%MSt-1.
INFLATION TARGETING AND UNEMPLOYMENT
1) The idea here is to see whether the inflation targeting takes unemployment is a factor
in inflation rates. The model that is suitable is as follows:
p t = b1 + b2p texpected + b3 (Ut -U tN) + b4 (y - yttrend )+ ut or
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p t = b1 + b2p texpected + b3 (Ut -U tN)+ b4 (changeinavelabproductivity)+ ut
where the inflation rate is a function of the expected inflation (lagged inflation rate
assuming adaptive expectations), unemployment rate above natural rate of
unemployment, and income above trend income (or labor productivity measure).
b
The objective is to examine the significance and sign of 3 .
2) For the observations data from World Bank can be used. The period under study
should be at least 7-10 years of monthly data. You need to choose from countries with
inflation targeting experience. These should be the ones which overtly claim to do
inflation targeting.
3) Data should be monthly. You should find the inflation targeting countries and their
history in this policy experience. It is better to have one developed and one
developing country.
CARBON DIOXIDE EMISSIONS AND GROWTH
1) This is the relationship between the emission of carbon dioxide and economic growth.
You may be able to do this both with cross sectional data and with time series data.
Since you can only find annual data, if you plan do conduct your analysis for time series
you need to be careful to include sufficient number of years such as 40 or more.
2) You may include 4 years and choose a group of countries, such as 1990, 1995, 2000,
2005, and include all OECD countries. If you are using 2 -3 countries, you should have
enough data on the number of years for each individual country.
3) The regression equation may be something like:
CO2 = b1 + b2GDP + b2GDP 2 + b3Openness + b4 DevelopingDummy + u
4) The variables are in per capita basis to get rid of scale effect.
GENDER WAGE GAP
1) Here, you need to take a cross section of countries, and choose 2-5 years depending on
the number of countries that you have in your sample. Try to choose your years apart,
not consecutively. It can be 3 or 5 or 10 years apart as long as data availability permits.
2) Your equation shuld be something like:
Wage = b1 + b2 Education + b2Unemployment + b3Genderdum + b4others + u
3) You may want to add other variables if you think will influence the wage gap. Look at the
discussion in the literature.
4) Make sure that the definition of your variables is such that the scale effect and inflation
effect has been addressed.
SPORTS REGRESSIONS AND OTHER TOPICS
At this point I will give individual comments on these…
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