Econometrics II – Winter 2008

 

The great enemy of clear language is insincerity. When there is a gap between one's real and one's declared aims, one turns, as it were, instinctively to long words and exhausted idioms, like a cuttlefish squirting out ink.

From Politics and the English Language, a famous essay by George Orwell

This quote certainly applies to empirical economics

 

Please report to byront at u.washington.edu for any typo, blunder or nonsense.

OFFICE HOURS: Tues and Thus 5:00 pm – 6:00 pm

VENUE: Condon 413-6 (Next to the econ grad mailroom)

EMAIL: byront at u.washington.edu

 

HANDOUTS

January 18th: The Classical Linear Regression Model

January 30th (Wednesday 5:00 – 9:00): More about the CLR Model + Geometry of OLS

February 8th: Introduction to Asymptotic Theory

February 15th: Nonspherical Disturbances

February 22nd: Lag Operator

February 29th: Maximum Likelihood Estimation

March 7th: Probit, Logit and Tobit

 

HOMEWORK

1. Weekly Homework: analytical problems, computing problems and reading assignments of five empirical papers from the reading list

Homework 1 (Due Friday Feb 8th)                Suggested Solution to Homework 1              hw1a.m            hw1b.m            hw2.m

Economic Growth in a Cross Section of Countries by Robert J. Barro (Quarterly Journal of Economics, Vol. 106, No. 2. (May, 1991), pp. 407-443.)

Short-Term Interest Rates as Predictors of Inflation by Eugene F. Fama (American Economic Review, Vol. 65, No. 3. (Jun., 1975), pp. 269-282.)

Stochastic Implications of the Life Cycle-Permanent Income Hypothesis: Theory and Evidence by Robert E. Hall (Journal of Political Economy, Vol. 86, No. 6. (Dec., 1978), pp. 971-987.)

Why Do Some Countries Produce So Much More Output Per Worker Than Others? by Robert E. Hall; Charles I. Jones (Quarterly Journal of Economics, Vol. 114, No. 1. (Feb., 1999), pp. 83-116.)

A Contribution to the Empirics of Economic Growth by N. Gregory Mankiw; David Romer; David N. Weil (Quarterly Journal of Economics, Vol. 107, No. 2. (May, 1992), pp. 407-437.)

 

Homework 2 (Due Friday Feb 15th)  Suggested Solution to Homework 2

The Effect of Aggregate Economic Variables on Congressional Elections by Francisco Arcelus; Allan H. Meltzer (American Political Science Review, Vol. 69, No. 4. (Dec., 1975), pp. 1232-1239.)

Working for Nothing: The Supply of Volunteer Labor by Richard B. Freeman (Journal of Labor Economics, Vol. 15, No. 1, Part 2: Essays in Honor of Yoram Ben-Porath. (Jan., 1997), pp. S140-S166.)

An Economic Theory of Suicide by Daniel S. Hamermesh; Neal M. Soss (Journal of Political Economy, Vol. 82, No. 1. (Jan. - Feb., 1974), pp. 83-98.)

The Effects of Economic Policies on Votes for the Presidency: Some Evidence from Recent Elections by Allan H. Meltzer; Marc Vellrath (Journal of Law and Economics, Vol. 18, No. 3, Economic Analysis of Political Behavior: Universities-National Bureau Conference Series Number 29. (Dec., 1975), pp. 781-798.)

 

Homework 3 (Due Friday Feb 29th)              affairs              phillips             

Suggestion Solution to Homework 3             hw4.m              hw51.m            hw52.m            hw61.m            hw62.m

Labor Rent Sharing and Regulation: Evidence from the Trucking Industry by Nancy L. Rose (Journal of Political Economy, Vol. 95, No. 6. (Dec., 1987), pp. 1146-1178.)

The Relationship between Wages and Weekly Hours of Work: The Role of Division Bias by George J. Borjas (Journal of Human Resources, Vol. 15, No. 3. (Summer, 1980), pp. 409-423.)

 

Homework 4 (Due Friday Feb 29th)  Suggested Solution to Homework 4  hw4_q7.m        hw4_q8.m

Africa's Growth Tragedy: Policies and Ethnic Divisions by William Easterly; Ross Levine (Quarterly Journal of Economics, Vol. 112, No. 4. (Nov., 1997), pp. 1203-1250.)

Does Social Capital Have an Economic Payoff? A Cross-Country Investigation by Stephen Knack; Philip Keefer (Quarterly Journal of Economics, Vol. 112, No. 4. (Nov., 1997), pp. 1251-1288.)

 

Homework 5 (Due Friday Mar 7th)   Suggested Solution to Homework 5  hw5_q5.m        ll_q5.m            hw5_q6.m            ll_q6.m            hw5_q7.m                   

Law and Finance by Rafael La Porta; Florencio Lopez-de-Silanes; Andrei Shleifer; Robert W. Vishny (Journal of Political Economy, Vol. 106, No. 6. (Dec., 1998), pp. 1113-1155.)

Finance and Growth: Schumpeter Might be Right by Robert G. King; Ross Levine (Quarterly Journal of Economics, Vol. 108, No. 3. (Aug., 1993), pp. 717-737.)

Growth in Cities by Edward L. Glaeser; Hedi D. Kallal; José A. Scheinkman; Andrei Shleifer (Journal of Political Economy, Vol. 100, No. 6, Centennial Issue. (Dec., 1992), pp. 1126-1152.)

 

 

2. Two Mega Homework: in-depth reading and replication assignments of two to three empirical papers 
Mega Homework 1 (Due Tuesday Feb 26th)

Testing the Permanent Income Hypothesis of Consumption                    data    

Mega Homework 2 (Due Tuesday Mar 11th)

Can the Term Structure of Interest Rates Predict Inflation?                    data