EE325 Introductory Econometrics

Semester: 2/2006 (Jan 8- April 28, 2007) Instructor: Supanit Tangsangasaksri Email: supanitt@gmail.com Office: Room 519, Faculty of Economics, Thammasat University Office Hours: Tuesdays and Thursdays, 15.00-16.30 or by appointment Lectures: Tuesdays and Thursdays, 11.00-12.30

(No class during the mid-term week: Feb 26th - March 3rd, 2007) Venue: Room 201 Textbooks:

Gujarati, D.N. (2003) Basic Econometrics. 4th ed. Singapore, McGraw-Hill. (G) Hill, R.C., W.E. Griffiths, and G. G. Judge (2001) Undergraduate Econometrics. 2nd ed. New York, John Wiley &Sons, Inc. (HGJ) Wooldridge, J. M. (2003) Introductory Econometrics: A Modern Approach. 2nd ed. Ohio: South-Western. (W) Dougherty, C. (2002) Introduction to Econometrics. 2nd ed. New York: Oxford University Press. (D)

Prerequisites: EE211, EE212 and MA216 (or MA211) and ST216 (or ST211) Credits will not be awarded to students who are taking or have completed EE425 Description of the Course: Application of statistical and economic theories in analyzing economic data, with emphases on parameter estimation techniques and applications of simple and multiple regression models to economic analyses. Use of computer application in practice is also covered. Course Goal: To provide students a good start on applying econometric tools for economic analysis. Tentative Grading*: Homework 20% Midterm Exam 30% (Tuesday February 27th , 2007, 11-12.30 hrs) Final Exam 50% (Monday May 14th , 2007, 9-12.00 hrs.) *I reserve the right to modify these weights as needed during the semester, but the chance that I will need to do that is very small. Regular class attendance is strongly encouraged. Important points will be emphasized in class. You will find that consistent class attendance will increase your chances for success and lightening your outside of class workload. Although class attendance is not a criterion upon which your grade will be based and there is no penalty for class absences, attendance

will be taken every class day and a modest amount of extra credit (bonus point) may be given for attendance. Homework assignments will be equally weighted. Lowest homework score will be dropped. Late homework will be graded based on 50% of full credit. More than two-day late homework will not be accepted. Do not miss the test. Makeup midterm exam will not be given. In case of emergency, please contact me to discuss your situation; in such circumstance a missed midterm exam will be dropped and more weight will be placed on the final exam.

Tentative Course Outline 1. Introduction: Why study Econometrics and what is Econometrics? Methodology of Econometrics Reference: G chapter 1; HGJ chapter 1, W chapter 1 2. Basic Probability Concepts Reference: G appendix A; HGJ chapter 2; W appendix B & C 3. Simple Linear Regression Model The principle of ordinary least squares Interval estimation and hypothesis testing Alternative functional forms Reference: G chapter 3,5 and 6; HGJ chapter 3-6; W chapter 2-4 and 6 After this topic, there will be a computer session to provide students an initial exposure to working with statistical packages, such as Eviews and Stata. 4. Multiple Regression Model The problem of estimation The problem of inference Reference: G chapter 7-8; HGJ chapter 7-8; W chapter 3-6 5. Dummy variable Reference: G chapter 9; HGJ chapter 9; W chapter 7 6. Relaxing the Assumptions of the Classical Model Multicollinearity Heteroskedasticity Autocorrelation Specification error Reference: G chapter 10-12; HGJ chapter11-12, W chapter 8 & 12