# Virtual University of Pakistan

## Featured Courses

Home > Courses > Economics > ECO601

## ECO601 : Business Econometrics

### Course Overview

#### Course Synopsis

The course aims at enhancing the knowledge and skill related to use of econometrics in business research. It covers problems like regression analysis, regression diagnostics, simultaneous and structural equation systems, and categorical dependent variable models. The course may cover topics in analyzing cross sectional data, time series and panel data. The course focuses on learning the theory of econometrics but may have both the theoretical and practical aspect using software like Microsoft Excel, SPSS and/or ‘Stata’where necessary.

#### Course Learning Outcomes

After studing this course;

• The students may be able to apply econometric techniques to research in business.
• The course shall result in developing good skills in applying econometric modeling to business studies.
• It will lead to enabling the students to be independent researchers, who can analyze, estimate and forecast business outcomes.
• It develops the skills related to analyze a research question, apply an appropriate model, estimate models and forecast results.

#### Course Calendar

 Topic Lecture Resource Page What is Econometrics About? 1 Handouts 2 Why should we study Econometrics? 1 Handouts 4 Methodology of Econometrics. 1 Handouts 5 Structure of Data 1 Handouts 6 Sources of Data 1 Handouts 8 Types of Data files 1 Handouts 8 Summation Operators 2 Handouts 9 Some functions & their properties. (Linear, quadratic, Natural Logarithm, exponential functions etc.) 2 Handouts 16 Derivatives 3 Handouts 21 Higher order derivatives 3 Handouts 32 Partial derivatives 4 Handouts 33 Multivariate Optimization 5 Handouts 40 Basics of Probability distributions 5 Handouts 46 Normal and related distributions 5 Handouts 49 Definition of The Simple Regression Model - I 6 Handouts 54 Deriving the ordinary least square (OLS) estimates and their formula 6 Handouts 62 Properties of OLS 6 Handouts 65 Estimation and Testing in Regression Analysis 7 Handouts 67 Examples Using Microsoft Excel 8 Handouts 79 Effects of changing Units of Measurement 8 Handouts 84 Incorporating nonlinearities in simple regression 8 Handouts 85 Multiple Regression 9 Handouts 89 Deriving the estimates and their formula with 2 independent variables 9 Handouts 89 Diagnostic Tests 9 Handouts 98 Analysis ToolPak: DATA ANALYSIS Add-In in Microsoft Excel 100 Understanding the Regression Results 10 Handouts 107 Assignment Transformation for Regression 11 Handouts 111 Exponential and Logarithmic Function 11 Handouts 112 Dynamic Models: Models with lagged independent Variable 11 Handouts 115 Models with interaction terms 11 Handouts 115 Regression on standardized variables 12 Handouts 117 Summary Statistics, Correlation Matrix, Graphs 12 Handouts 118 Regression with qualitative explanatory variables 13 Handouts 125 Dummy Variables and their use 13 Handouts 125 Using logs in regression analysis 14 Handouts 132 Regression with growth rates, ratios and percentages 14 Handouts 133 Treatment of missing data 14 Handouts 134 What is Multicollinearity? 15 Handouts 139 Theoretical Consequences of Multicollinearity 15 Handouts 142 Practical consequences of Multicollinearity 15 Handouts 143 How to detect for Multicollinearity? 15 Handouts 143 Quiz No 01 Remedial Measures for Multicollinearity 16 Handouts 146 Some practical examples 17 Handouts 147 What is Heteroskedasticity? 17 Handouts 152 Consequences of Heteroskedasticity? 17 Handouts 155 Tests for Heteroskedasticity: Visual Inspection 17 Handouts 155 Detection of Heteroskedasticity 18 Handouts 158 Formal Tests 18 Handouts 158 Detection of Heteroskedasticity: Examples of Formal Tests 19 Handouts 163 Dealing with Heteroskedasticity problem 19 Handouts 167 What is Serial Correlation? 20 Handouts 171 Nature of Serial Correlation 20 Handouts 171 Causes and examples 20 Handouts 172 Consequences 20 Handouts 174 Detection of Autocorrelation 21 Handouts 176 Graphic method, AR(1) test with strictly exogenous regressors, AR(1) test without strictly exogenous regressors, Durbin Watson d Test, Durbin h Test, LM Test 21 Handouts Treatment of Autocorrelation 22 Handouts 184 Removal: Generalized differencing (GLS 22 Handouts 184 Generalized Differencing : Special Cases 22 Handouts 185 MID-TERM EXAMS 23 Handouts 193 Transforming models and estimating by OLS 23 Handouts 196 Introduction to Stata 24 Handouts 200 Introduction to Stata 25 Handouts 210 Data Management in Stata 26 Handouts 218 Practice session of Stata 27 Handouts 228 Graphs in Stata 28 Handouts 228 Regression with Stata 29 Handouts 241 Post Regression analysis 29 Handouts 245 Simultaneous Equation Models 30 Handouts 254 Exogenous and Endogenous Variables 30 Handouts 255 Identification Problem 30 Handouts 256 Simultaneous Equation Models-II 31 Handouts 259 Examples 31 Handouts 263 Quiz No 02 Indirect Least Square (ILS): EXAMPLE II) 32 Handouts 266 Examples of Identification and applying ILS 32 Handouts 271 Graded Discussion Board Two Stage Least Square 33 Handouts 273 Examples of Identification & applying 2SLS 33 Handouts 274 Using Stata for Two Stage Least Square (2SLS) 33 Handouts 278 Two Stage Least Square: continued 34 Handouts 282 Three stage least square 34 Handouts 285 Three Stage Least Square: Select independent variables 34 Handouts 286 Panel Data Methods 35 Handouts 291 Pooled Regression 35 Handouts 294 Least Square Dummy Variable model 35 Handouts 294 Error component: one way and two way 36 Handouts 295 Fixed Effect Model 36 Handouts 297 Fixed Effect Model Estimation: First Difference 36 Handouts 298 Random Effect Model 36 Handouts 299 Panel Data Models using Stata 36 Handouts 300 Panel Data Methods & Post Estimation Tests 37 Handouts 307 Qualitative and limited dependent variable 38 Handouts 321 Logistic Regression 38 Handouts 321 Logistic Regression using Stata 38 Handouts 322 Example of Logistic Regression using Stata 38 Handouts 323 Ordinal Logistic Regression 38 Handouts 324 Qualitative and limited dependent variable 39 Handouts 328 Probit Regression 39 Handouts 329 Example of probit Regression using Stata 39 Handouts 330 Ordinal Probit Regression 39 Handouts 331 Qualitative and limited dependent variable 40 Handouts 334 Post regression tests after logit/probit models 40 Handouts 336 Censored Data Regression Models 40 Handouts 337 Tobit Model using Stata 40 Handouts 338 Quiz No 03 Forecasting 41 Handouts 343 Types of Forecasts 41 Handouts 344 Time Series Models for forecasting 41 Handouts 346 Examples of Forecasting Techniques 41 Handouts 347 Forecasting( Count-) 42 Handouts 352 Seasonal Variation and forecasting 42 Handouts 352 Calculating Seasonal Index 42 Handouts 352 Measuring Forecast Performance 42 Handouts 354 Variance of Forecast Error 42 Handouts 361 Stationary & Non-Stationary data 43 Handouts 364 Unit Root Test 43 Handouts 366 Cointegration & Error Correction Model Using Stata 44 Handouts 373 Cointegration & Error Correction Model Example 44 Handouts 375 Time Series Revisited 45 Handouts 379 VAR 45 Handouts 380 ARMA processes 45 Handouts 384 VECM 45 Handouts 387 FINAL-TERM EXAMS

Back to Top