AUSTRALIAN SCHOOL OF BUSINESS

SCHOOL OF ECONOMICS

ECON3208 / ECON3291 (ARTS)

Econometric Methods

SESSION 1, 2011

COURSE INFORMATION AND LECTURE SCHEDULE

Lecturer in Charge:
Dr. Rachida Ouysse
Room ASB441
Telephone: 9385 3321
Email: [email protected]

Lectures: Wednesdays 15:00-17:00

Venue: Macauley Theatre (QUAD 1027)

Website: http://telt.unsw.edu.au/
 Table of Contents 
1.1 Communications with staff 3 

2. COURSE DETAILS  3 
2.1  Class hours 3 
2.2  Units of credit 4 
2.3 Course Summary 4 
2.4 Relationship of this course to other courses 4 
2.5 Student Learning Outcomes 5 

3. LEARNING AND TEACHING ACTIVITIES  5 
3.1 Approach to learning and teaching 5 
3.2 Teaching and learning strategies 6 

4.  ASSESSMENT  7 
4.1 Formal requirements 7 
4.2 Assessment details 7 
4.3Tutorial Work 7 
4.3.1 Tutorial Participation 7 
4.3.2 Tutorial Assignment 8 
4.3.3 Submission Procedure for Assignment 8 
4.4 Project 8 
4. 4.1 Group work (Optional) 9 
4.4.2 Project Submission 9 
4.5 Mid-term test 9 
4.6 Final examination 10 
4.7 Quality Assurance 10 

5. ACADEMIC HONESTY AND PLAGIARISM  10 
6. COURSE EVALUATION AND DEVELOPMENT  11 
7. STUDENT RESPONSIBILITIES AND CONDUCT  11 
8. STUDENT RESOURCES AND SUPPORT  13 
9. COURSE RESOURCES  14 
9.1 COURSE WEBSITE  14 
9.2 TEXTBOOK AND READINGS  14 
9.3  COMPUTING WORK  15 
10.COURSE SCHEDULE  16 

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1. STAFF CONTACT DETAILS
Lecturer-in-charge:
Dr. Rachida Ouysse
Room ASB441
Phone No: 9385 3321
Email: [email protected]
Consultation Times – Tuesday 3pm-6pm.
Location: Room ASB441

Emails MUST have a clear subject line. I will answer your Email enquiries within 48
hours (Does not include weekends).

Tutors: Peng Huang ([email protected])

Peter Lee ([email protected] )

Any questions regarding the tutorial program including administrative matters regarding
tutorial allocation should be directed to your tutor.

1.1 Communications with staff

The lecturer-in-charge is responsible for the course content as well as the overall
administration of the course. You should feel free to approach during consultation
times (TBA) about any academic matter related to the course. (However, please note
that the lecturer has no advance notice of the date and time of the exam.)

Students are encouraged to ask questions related to this subject during lectures when
time permits and especially during tutorials. Consultations are an opportunity for you
to ask questions.

You must not expect a review of the lecture material during consultation hours. I will
not go over tutorial problems that have been discussed in tutorials. You should
prepare specific questions and discuss the specific issues and concerns you have in
understanding the course material. Consultations time is limited and you are advised
to take advantage of tutorial hour.

Discussion of course subject material will not be entered into via lengthy emails.

2. COURSE DETAILS 
2.1 Class hours
There is one 2-hour lecture and one 1-hour tutorial class per week. The lecture is
scheduled for Wednesdays 15:00-17:00 in the Macauley theatre (Quad 1027).

Lectures will run from week 1 to week 12 inclusively.

Each student should enrol in a tutorial group which meets for one hour each week.
Students enrol via their MyUNSW site. Once enrolled, moving from one tutorial
group to another will not be permitted unless you have compelling reasons. You
should consult the tutor-in-charge about these matters.

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If, due to illness or other exceptional circumstances, you are unable to attend your
usual tutorial, you may try to attend another tutorial in the same week. However, you
are required to attend your usual tutorial class at least 9 times during the session. This
allows for occasional absence due to minor illness and other reasons, hence Special
Consideration applications will not reduce this requirement. Students should also note
that, in certain circumstances, such as where a request for Special Consideration is
made in relation to assessment items, tutorial attendance will be taken into account in
determining your final assessment or whether Special Consideration is granted.

Tutorials will run from week 2 to week 13 inclusively.

2.2 Units of credit

This subject is worth 6 units of credit. There is no parallel teaching in this course.
The prerequisite for the course is ECON2206, Introductory Econometrics. Students
are presumed to be familiar with the material covered in the ECON1202, ECON1203,
and ECON2206 sequence taught at UNSW.

2.3 Course Summary

Econometric theory provides the techniques needed to quantify the strength and form of
relationships between variables. Modern computer software makes it easy to implement
these techniques, such as running a regression, but how do you know which model to
specify or whether the data are appropriate? Applied econometrics is concerned with the
strategies that lead to an effective use of econometric techniques. Together these techniques
and strategies constitute what we define as “econometric methods”. In this course, these
methods are reviewed and students are asked to conduct various applications of
econometric techniques to economic data. The course emphasises the implications of the
assumptions behind the econometric techniques used for inference. In addition to the
applied component that shows the implications of “wrong” assumptions, this course also
makes use of theoretical results and analytical development to show the effects of different
modelling assumptions on estimation and inference.

2.4 Relationship of this course to other courses

This course is a core requirement for the BEc and represents the second in a sequence of
econometrics courses (the first being ECON2206) designed to equip students with
knowledge of the key econometric tools and methods expected of an applied economist.

The course also provides necessary skills and techniques that will be used in further study
of econometrics and economics more generally. A specialization in econometrics or
business statistics is designed to equip students with the more advanced statistical and
quantitative skills that are widely used and increasingly demanded by employers in
commercial fields and the public sector.

The primary objective of the course is to provide a solid theoretical and practical
foundation for interpretation of empirical evidence in economics. The course therefore has
two components: econometric theory and “Hands-on” experience.

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2.5 Student Learning Outcomes
On completion of the course, students will
1. Be more familiar with guidelines for using econometric techniques effectively.
2. Have a better appreciation of the model building cycle and the relevance of
theoretical models in conducting applied work.
3. Have the confidence and skills to critically evaluate empirical research.
4. Have a thorough understanding of why it is necessary to consider extensions to the
classical linear regression model when dealing with discrete dependent variables.
5. Be familiar with a range of econometric models and tools that are useful when
dealing with discrete dependent variables.
6. Have a deeper understanding of the problems of omitted variables, endogenous
regressors, nonstationarity and selection bias, problems that are prevalent in most
economic data.
7. Understand the models that become available when dealing with panel data and how
they are related to modern policy evaluation.
8. Have developed proficiency in the use of Stata for econometric modelling.

Graduate Attributes
Course ASB Graduate Attributes
Learning
Outcomes
1, 2, 3, 4, 5, 6, 7 Critical thinking and problem solving
1, 2, 3, 8 Communication
1, 2, 3 Teamwork and leadership
1, 2, 3, 7 Social, ethical and global perspectives
1, 2, 4, 5, 6, 7 In-depth engagement with relevant disciplinary knowledge
1, 2, 3, 7, 8 Professional skills

3. LEARNING AND TEACHING ACTIVITIES 
3.1 Approach to learning and teaching
The philosophy underpinning this course and its Teaching and Learning Strategies (3.3
below) are based on “Guidelines on Learning that Inform Teaching at UNSW”. These
guidelines may be viewed at: www.guidelinesonlearning.unsw.edu.au.

Quantitative information and statistics are pervasive not only in the study of economics and
business but in understanding a wide range of phenomena. Every attempt will be made to
demonstrate the relevance of the course to understanding such phenomena. This will
require applying econometric and statistical methods and techniques to practical problems
in a broad set of topics.

Students who are undertaking this course will have some background in basic statistics and
grounding in the principles of regression analysis. Using this knowledge as a base, an
extensive discussion of the use of regression theory and some of its extensions will be
provided. We demonstrate how regression models can be applied to data to estimate

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relationships, to forecast and to test hypotheses that arise in economics and business. We also
discuss common problems that arise in most economic data.

General principles or guidelines for undertaking applied work are discussed. In particular, we
stress careful data analysis, the need to evaluate estimated models and the importance of the
links between econometric models and the underlying substantive knowledge or theory
associated with the particular application. These issues will be related to applications drawn
from various fields.

It is essential that the discussion of how to use econometric tools effectively be

complemented with practice in analysing data. An important aid in this particular task will
be the computing component where the popular econometrics package Stata will be used.

3.2 Teaching and learning strategies

The examinable content of the course comprises the material covered in lectures, assigned
readings and tutorials.

Lectures
The purpose of lectures is to provide a logical structure for the topics that make up the
course; to emphasise the important concepts and methods of each topic, and to provide
relevant examples and case studies to which the concepts and methods are applied.

Tutorials
The object of the tutorials is to discuss various approaches to, and issues associated with
the assigned exercises and topics covered in the course. Each week a document will be
posted containing the exercises which are to be covered in tutorials. A number of these
exercises are intended to be challenging so as to stimulate questions and discussion.
Therefore students should not feel inadequate if they have difficulty solving all the
exercises before attending their tutorial. However, it is important that students attempt the
assigned exercises before the corresponding tutorial sessions. Tutorials are an integral
component of the course; attendance and participation in your tutorial is crucial for your
successful completion of the course

Discussion Forum
A Discussion Forum will operate on the Course website. Tutors will monitor the discussion and
answer questions when needed.

Learning strategies
While students may have preferred individual learning strategies, it is important to
note that most learning will be achieved outside of class time. Lectures can only
provide a structure to assist your study, and tutorial time is limited.

An ‘ideal’ learning strategy (on which provision of the course materials is based) might
include:
 Prior to attending a lecture, read the assigned readings for the lecture. Also download
and read the lecture notes for your lecture and bring them with you to the lecture. The
lecture notes are available for downloading on the Econometric Methods website.
 Attend the lecture. The lecture notes form the basis for the lecture. Key concepts will
be emphasised and demonstrated through worked examples.

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  Complement your lecture notes with the assigned readings and ask questions from the
lecturer or your tutor if some issues are still unclear.
 Prior to attending tutorials, attempt the assigned questions for that week. Do not be
discouraged if you cannot answer all of the questions as some questions are more
difficult than others. Attempting the assigned tutorial questions will provide a self-test
of your understanding of particular topics and identify those topics which may require
further attention. Many of the tutorial questions have been taken from past exam
papers. Tutors will work through the assigned tutorial questions each week.
 Attempt additional problems from the end-of-chapter questions in the textbook. Many
of the tutorial and examination questions have a similar structure to the textbook
questions. By attempting additional questions, you are able to test your own
knowledge and, through practice and experience, improve your understanding of the
material.

4.  ASSESSMENT 
4.1 Formal requirements
To be eligible for a passing grade in this course, students must:
a) Achieve a composite mark of at least 50 per cent;
AND
b) Satisfactorily complete all assessment tasks or submit appropriate documentation
relating to your failure to complete a task to the Lecturer in Charge.
AND
c) Achieve a satisfactory level of performance in the final exam. This usually means a
minimum mark of 40 per cent (mark of 20/50). Any student having an overall mark
of 50 or more but less than 40 per cent in the final examination will be given an
UF grade (unsatisfactory fail).

4.2 Assessment details

Learning ASB Graduate
Assessment
Weight Outcomes Attributes Length Due Date
Task
assessed assessed
Tutorial Work 15% 1-8 1,2,5,6 Weeks 4,9
Mid-term 15% 1-8 1-6 1 hour Week 6
Project 20% 1-8 1-6 Week 11
University
Final Exam 50% 1-8 1,2,4,5,6 3 hours
Exam Period

4.3Tutorial Work

4.3.1 Tutorial Participation

No marks are awarded for tutorial attendance. However, a record of attendance at
tutorials will be kept. Students should note that 80% attendance is required by
UNSW and ASB rules. In certain circumstances, such as where a request for special
consideration is made in relation to assessment items, tutorial attendance will be

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taken into account in determining your final assessment or whether special
consideration is granted.

Attendance at 9 of 12 tutorials will be deemed as meeting the requirement. Students

must sign on by 10 minutes from the start of tutorial to qualify as ‘in attendance’.
Signing on for another student will be treated as misconduct. If, owing to illness or
other exceptional circumstances, you are unable to attend your usual tutorial, you
may try to attend another tutorial in the same week. However, you are required to
attend your usual tutorial class at least 9 times during the session. This allows for
occasional absence due to minor illness and other reasons, hence special
consideration applications will not reduce this requirement.

4.3.2 Tutorial Assignment

Problems (involving theory and practice) and computer exercises will be distributed every
week. Written answers will be required for a subset of these while other questions will be
earmarked for discussion in lectures and tutorials.

In order to review your progress, written answers for pre-specified questions will be
collected during week 4 and week 9 tutorials.

The tutorial assignments will be marked and handed back as promptly as possible. Written
answers must be neatly presented. Pages must be stapled and the student name and
number must be indicated. More details on the assignments will be provided in class and on
the website. You are allowed to work in groups of a maximum of three. Your group
members MUST belong to the same tutorial group. This requirement is NOT
negotiable.
The purpose of the assignments is to test knowledge and understanding of econometric
concepts, methodology and interpretation of results and the ability to apply econometric
reasoning in solving a realistic problem. It will also provide a self-test of how you are
doing in the course.

Tutorial assignments along with the midterm test provide important feedback mechanism
for the lecturer on any major issues faced by the students. These will then be addressed in
lectures/tutorials.

4.3.3 Submission Procedure for Assignment

You must submit 1 hard copy of the assignment to your tutor at the start of the
tutorial hour of the week the assignment is due.

4.4 Project
In keeping with the main objectives of the course students are expected to gain some
experience in “doing econometrics”. The major project serves this purpose. Students will
be given a pre-assigned topic where each student will receive a personalized set of data to
analyse. The results of the analysis will be presented in the form of a report.

Questions and issues related to the project will be discussed in lectures and will form part
of the weekly tutorial questions. Note that although the questions specific to the project can

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be discussed with the lecturer and the tutors, specific answers will not be provided as these
will form part of the assessable document. The document must be typewritten and stapled.
Student name and number must be clearly indicated on the cover page.

4. 4.1 Group work (Optional)

Students may work together on the project and teams of up to a maximum of 4 students
can submit a joint project. There are no requirements for students to present joint projects
and students may choose to submit individual reports. A cover sheet for the project will be
posted on the course website. The group members are required to complete a peer
assessment sheet for the project. It is your responsibility to resolve any work load among
the group members. The peer assessment sheet will be used to assess each member’s
contribution to the project. In the event of a big discrepancy between group members’
contribution, the mark allocated to each member will be an average weighted by their
peers’ assessment. There is however no requirement for students to present joint projects
and students may choose to submit individual reports.

4.4.2 Project Submission

Students are required to submit a written copy AND an electronic copy of their
assignment. The electronic document must be a pdf file or a word file. Hard copies of the
document must be typewritten and stapled. Student name(s) and number(s) must be clearly
indicated on the cover page.

The hard copy of the major project should be deposited in the school’s collection box
by 5pm on Friday May 20th. The electronic copy of the major project must be
submitted on the course website by 11:59pm on Friday May 20th.

Submission via email or fax will not be accepted. Additional instructions on submission of
the electronic copy will be available on the website. You should keep a copy of all work
submitted for assessment as well as the returned marked assignments.

Late submissions: a penalty of 20% of the value of the project will be deducted for each
day (24 hours) or part thereof past the deadline unless an extension is granted. This
penalty will apply if either the hard or the electronic copy of the project is late. Because of
the integration of the project with lectures and weekly assignments, it is highly unlikely
that an extension to the deadline would be granted.

All electronic copies of essays will be checked for plagiarism on the Turnitin software into
which they are uploaded. See notes on Plagiarism below and also note that the Turnitin
software will automatically check against all other assignments submitted.

4.5 Mid-term test

A one hour test will be held on Wednesday April 6th at 15:00 in the usual lecture venue.
The questions will be based on the material covered in the first 6 weeks of the semester.
This exam will be worth 15% of the final semester grade. If you do not attend the test and
do not have an adequate reason you will be awarded a mark of zero. Documentary evidence
for an absence (e.g. medical certificate) must be provided to the lecturer. If approved, you
will have your final exam mark re-weighted according to the weight of the missed piece of
assessment. There will be no supplementary exam for this component of the evaluation.

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The purpose of this assessment is to test your knowledge of core econometric concepts and
methodology. It will also be useful as a signal to you about your understanding of the
course material to date.

4.6 Final examination

A three hours final examination will be held during the University’s final examination
period. Examples of previous exam questions will be provided and the format of the exam
will be discussed in the lectures.

The purpose of the final examination is to assess knowledge of econometric concepts,

methodology and interpretation of results relating to the models reviewed in class. It is
designed to test your learning and understanding of both the theoretical and empirical
aspects of different econometric techniques discussed. All material covered in the lectures
and tutorial program is examinable.

4.7 Quality Assurance

Quality Assurance
The ASB is actively monitoring student learning and quality of the student experience in all its
programs. A random selection of completed assessment tasks may be used for quality assurance,
such as to determine the extent to which program learning goals are being achieved. The
information is required for accreditation purposes, and aggregated findings will be used to inform
changes aimed at improving the quality of ASB programs. All material used for such processes
will be treated as confidential and will not be related to course grades.

5. ACADEMIC HONESTY AND PLAGIARISM 
The University regards plagiarism as a form of academic misconduct, and has very strict rules
regarding plagiarism. For UNSW policies, penalties, and information to help you avoid plagiarism
see: http://www.lc.unsw.edu.au/plagiarism/index.html as well as the guidelines in the online
ELISE and ELISE Plus tutorials for all new UNSW students:
http://info.library.unsw.edu.au/skills/tutorials/InfoSkills/index.htm.
To see if you understand plagiarism, do this short quiz:
http://www.lc.unsw.edu.au/plagiarism/plagquiz.html
For information on how to acknowledge your sources and reference correctly, see:
http://www.lc.unsw.edu.au/onlib/ref.html

For the ASB Harvard Referencing Guide, see the ASB Referencing and Plagiarism web page:
http://www.asb.unsw.edu.au/learningandteaching/studentservices/resources/Pages/referencingand
plagiarism.aspx

In the School of Economics all cases of substantial plagiarism are reported to the
Associate Head of School. The following penalties will apply:
 Reduction in marks for the assessment item, including zero;
 Failure in the course [00FL] in extreme cases;

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  Other additional penalties in accordance with the UNSW Procedures for Dealing with
Student Plagiarism, may be considered in extreme cases;
 All cases will be recorded on the UNSW Plagiarism Central Register

6. COURSE EVALUATION AND DEVELOPMENT 
Each year feedback is sought from students about the courses offered in the School
and continual improvements are made based on this feedback. UNSW's Course and
Teaching Evaluation and Improvement (CATEI) Process is one of the ways in which
student evaluative feedback is gathered. You are strongly encouraged to take part in
the feedback process.

7. STUDENT RESPONSIBILITIES AND CONDUCT 
Students are expected to be familiar with and adhere to university policies in relation
to class attendance and general conduct and behaviour, including maintaining a safe,
respectful environment; and to understand their obligations in relation to workload,
assessment and keeping informed.

You are expected to conduct yourself with consideration and respect for the needs of
your fellow students and teaching staff. Conduct which unduly disrupts or interferes
with a class, such as ringing or talking on mobile phones, is not acceptable and
students may be asked to leave the class.

Information and policies on these topics can be found in the ‘A-Z Student Guide’:
https://my.unsw.edu.au/student/atoz/A.html. See, especially, information on ‘Attendance and
Absence’, ‘Academic Misconduct’, ‘Assessment Information’, ‘Examinations’, ‘Special
Consideration’, ‘Student Responsibilities’, ‘Workload’ and policies such as ‘Occupational
Health and Safety’.

7.1 Workload
It is expected that you will spend at least ten hours per week studying this course.
This time should be made up of reading, research, working on exercises and
problems, and attending classes. In periods where you need to complete assignments
or prepare for examinations, the workload may be greater.

Over-commitment has been a cause of failure for many students. You should take the
required workload into account when planning how to balance study with
employment and other activities.

7.2 Attendance
Your regular and punctual attendance at lectures and seminars is expected in this
course. University regulations indicate that if students attend less than 80% of
scheduled classes they may be refused final assessment.

7.3 Keeping informed

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You should take note of all announcements made in lectures, tutorials or on the
course web site. From time to time, the University will send important
announcements to your university e-mail address without providing you with a paper
copy. You will be deemed to have received this information. It is also your
responsibility to keep the University informed of all changes to your contact details.

7.4 Special consideration and supplementary examinations

You must submit all assignments and attend all examinations scheduled for your
course. You should seek assistance early if you suffer illness or misadventure which
affects your course progress.

General Information on Special Consideration:

1. For assessments worth 20% or more, all applications for special consideration
must go through UNSW Student Central
(https://my.unsw.edu.au/student/academiclife/StudentCentralKensington.html)
and be lodged within 3 working days of the assessment to which it refers;
2. Applications will not be accepted by teaching staff, but you should notify the
lecture-in-charge when you make an application for special consideration
through UNSW Student Central;
3. Applying for special consideration does not automatically mean that you will
be granted a supplementary exam;
4. Special consideration requests do not allow lecturers-in-charge to award
students additional marks.
ASB Policy on requests for Special Consideration for Final Exams:
The policy of the School of Economics is that the lecturer-in-charge will need to be
satisfied on each of the following before supporting a request for special
consideration:
1. Does the medical certificate contain all relevant information? For a medical
certificate to be accepted, the degree of illness, and impact on the student,
must be stated by the medical practitioner (severe, moderate, mild). A
certificate without this will not be valid.
2. Has the student performed satisfactorily in the other assessment items?
Satisfactory performance would require at least at least 40% in each
assessment item specified in the Course Outline and meeting the obligation
to have attended 80% of tutorials.
3. Does the student have a history of previous applications for special
consideration? A history of previous applications may preclude a student
from being granted special consideration.

Special Consideration and the Final Exam:

Applications for special consideration in relation to the final exam are considered by
an ASB Faculty panel to which lecturers-in-charge provide their recommendations
for each request. If the Faculty panel grants a special consideration request, this will
entitle the student to sit a supplementary examination. No other form of consideration
will be granted. The following procedures will apply:

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 1. Supplementary exams will be scheduled centrally and will be held
approximately two weeks after the formal examination period. The dates
for ASB supplementary exams for session 1, 2011 are:
12 July 2011 – exams for the School of Accounting
13 July 2011 – exams for all Schools other than Accounting and
Economics
14 July 2011 – exams for the School of Economics
If a student lodges a special consideration for the final exam, they are
stating they will be available on the above dates. Supplementary exams
will not be held at any other time.
2. Where a student is granted a supplementary examination as a result of a
request for special consideration, the student’s original exam (if completed)
will be ignored and only the mark achieved in the supplementary
examination will count towards the final grade. Failure to attend the
supplementary exam will not entitle the student to have the original exam
paper marked and may result in a zero mark for the final exam.

If you are too ill to perform reasonably on the final exam, do not attend the final and
apply for a supplementary instead. However granting of a supplementary exam in
such cases is not automatic. If a student attends the regular final, s/he is unlikely to be
granted a supplementary exam.

The ASB’s Special Consideration and Supplementary Examination Policy and

Procedures for Final Exams for Undergraduate Courses is available at:
http://www.asb.unsw.edu.au/currentstudents/resources/forms/Documents/supplement
aryexamprocedures.pdf.

Special consideration and assessments other than the Final exam:

For the application of special consideration to assessment items other than the final
exam, refer to the specific policies outlined. The School of Economics does not
provide supplementary assessment items other than for the final exam.

8. STUDENT RESOURCES AND SUPPORT 
The University and the ASB provide a wide range of support services for students,
including:
ASB Education Development Unit (EDU) (www.business.unsw.edu.au/edu)
Academic writing, study skills and maths support specifically for ASB students.
Services include workshops, online and printed resources, and individual
consultations. EDU Office: Room GO7, Ground Floor, ASB Building (opposite
Student Centre); Ph: 9385 5584; Email: [email protected]
Capturing the Student Voice: An ASB website enabling students to comment on
any aspect of their learning experience in the ASB:
http://www.asb.unsw.edu.au/currentstudents/resources/studentfeedback/Pages/default
.aspx

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Blackboard eLearning Support: For online help using Blackboard, follow the links
from www.elearning.unsw.edu.au to UNSW Blackboard Support / Support for
Students. For technical support, email: [email protected]; ph: 9385 1333
UNSW Learning Centre (www.lc.unsw.edu.au )
Academic skills support services, including workshops and resources, for all UNSW
students. See website for details.
Library training and search support services:
http://info.library.unsw.edu.au/web/services/services.html
IT Service Centre: Technical support for problems logging in to websites,
downloading documents etc. https://www.it.unsw.edu.au/students/index.html
UNSW Library Annexe (Ground floor)
UNSW Counselling and Psychological Services
(http://www.counselling.unsw.edu.au)
Free, confidential service for problems of a personal or academic nature; and
workshops on study issues such as ‘Coping With Stress’ and ‘Procrastination’.
Office: Level 2, Quadrangle East Wing; Ph: 9385 5418
Student Equity & Disabilities Unit (http://www.studentequity.unsw.edu.au) Advice
regarding equity and diversity issues, and support for students who have a disability
or disadvantage that interferes with their learning. Office: Ground Floor, John
Goodsell Building; Ph: 9385 4734

9. COURSE RESOURCES 
9.1 Course website 
The Econometric Methods website may be found at: http://telt.unsw.edu.au/
You are required to have a Unipass and a Unipin and be enrolled in the course to access the
website.

The website contains: (a) the course outline, the tutorial documents and other course
handouts; (b) the lecture notes; (c) data used in the tutorial problems and project; (d) past
exam papers; and (e) course announcements.

Students should consult this website at least once a week as it contains important
information about the course. It will be assumed that all students have seen any notice
posted on the course website.

9.2 Textbook and readings 
The textbook for this course is:

Wooldridge, J.M. (2009), Introductory Econometrics: A Modern Approach, 4th ed. South-
Western.

This is the basic reference for the course. It will be the primary source of extra reading for
material covered in lectures and assignments and some exercises will be taken from the
book.

An alternative text recommended for the course is:

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Stock, J.H. and M.W. Watson (2006), Introduction to Econometrics, 2nd ed. Addison-
Wesley.

Although Stock and Watson (2006) is not a required text, the reading list below includes
chapters from the text. The material is similar to that provided in Wooldridge but
sometimes, different styles or approaches in explaining the same material will be more
helpful to individual students. Both texts will be available in the Open Reserve Section of
the library. Also they will be available for purchase from the bookstore.

9.3 Computing work 
Computing is an integral component of Econometric Methods. Apart from tutorial
problems that require computing, the major project, which is worth 20% of the final grade,
cannot be successfully completed without using econometric software. Furthermore, some
exam questions will ask you to interpret various generic outputs and you will need
experience analysing and interpreting outputs to answer the questions appropriately.

The default econometric software is Stata. Assigned computer work may be done in
the computing labs; alternatively, you can obtain a personal copy of the Stata and
install it on your own PC. To purchase your own copy, you will need to fill out a
form and to pay the price of the version of Stata you choose to buy. Since the course
has been registered as part of Stata’s Gradplan students will have access to the
following prices:
 
Version of Stata license Price
Small Stata – 6 month license: $50
Small Stata – 1 year license: $73
Stata IC – perpetual license $223
Notes: In all cases, the installation CD includes PDF of manuals. Small Stata can
handle up to 99 variables x 1200 observations and is sufficient for this course. These
prices are for the most recent version of Stata which is version 11. For more
information on Stata prices in Australia, see:
http://www.survey-design.com.au/gradplan.html

There are lots of resources and support for Stata on the web. Particularly useful are
the following websites:
 For general help, browse through: http://www.ats.ucla.edu/stat/stata/
 You can work through a tutorial at: http://data.princeton.edu/stata/
 For help on getting started: http://www.stata.com/capabilities/session.html
 For examples based on the Wooldridge textbook:
http://fmwww.bc.edu/gstat/examples/wooldridge/wooldridge.html
 
The manual: A.C. Acock, “A Gentle Introduction to Stata”, 2nd edition, Stata Press,
2008 is an additional reference for further help.

Note that students do not need to buy their own copy of Stata and can choose to
conduct their computing work on campus in the computer labs. Also, it is possible to
complete the course using other software such as SHAZAM, SAS or E-Views;

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 however, EXCEL will not be sufficient. Tutorial answers and general support for
student queries will be given for Stata only.

10.COURSE SCHEDULE 
The schedule given below is only approximate because lectures, where possible, will
be interactive. This means there is some scope to discuss and cover specific material in
more or less detail depending on the preferences and needs of the class. Further reading
material may be introduced in due course. In the following, W refers to Wooldridge
(2009) while S&W refers to Stock and Watson (2006). The references to parts of earlier
chapters in Wooldridge (2009), especially those chapters already covered in ECON 2206
are not indicated. Students are encouraged to review the relevant material from ECON
2206 as we progress through the course.

Note: Additional readings will be assigned during class and posted on the website.

Week Date Topics Readings

1 March 2 Review of Topics in W: Ch. 1-19
Regression analysis S&W: Ch.1-3
2 March 9 Discrete Dependent W: Ch 2:5
variables: S&W:
Binary Response Model
3 March Discrete Dependent W: Ch 17 and
16 variables: Appendix B
The Tobit Model S&W: Ch. 11

4 March Limited Dependent W: Ch 17 and

23 Variables: Censored and Appendix B
Truncated S&W: Ch. 11
Tutorial Assignment 1
Due
5 March Instrumental Variable W: Ch 17 and
30 Estimation: Omitted Appendix B
Variables/Two Stage Least S&W: Ch. 11
Squares

6 April 6 MIDTERM
EXAMINATION

Instrumental Variable
Estimation: Errors in W: Ch 15
Variables Problem S&W: Ch. 9 and 12

7 April 13 Instrumental Variable W: Ch 15

Estimation: Testing for S&W: Ch. 9 and 12
Endogeneity and
Overidentification

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 Tutorial Assignment 2
Due
8 April 20 Regression Analysis with W: Ch 15
Time series: S&W: Ch. 9 and 12
OLS, Serial Correlation and
Heteroscedasticity
April 22-May 1st Session Recess
9 May 4 Regression Analysis with W: Ch 10,11,12,18
Time series: S&W: Ch. 12
Distributed Lag
Models/Unit root

10 May 11 Regression Analysis with W: Ch 10,11,12,18

Time series: S&W: Ch. 12
Spurious Regression/Error
correction model

11 May 18 Regression Analysis with W: Ch 10,11,12,18

Time series: S&W: Ch. 12
Forecasting

Project Due
12 May 25 Panel Data Analysis W: Ch 10,11,12,18
Review S&W: Ch. 12

11. KEY DATES AND STUDENT RESPONSIBILITIES

It is your responsibility to ensure that:

1. You are recorded by the University as being correctly enrolled in all your courses.

2. You have successfully completed all prerequisite courses. Any work done in courses
for which prerequisites have not been fulfilled will be disregarded (unless an
exemption has been granted), and no credit given or grade awarded.

3. You abide by key dates:

Monday 28 February is the first day of Semester 1 lectures. Sunday 6 March is the
last day you can enrol in Semester 1 courses.
Sunday 6 March is the due date for Semester 1 fees.

Thursday 31 March (Week 5) is the last day for students to discontinue without
financial penalty (and the last date to finalise arrangements for FEE-HELP).

Sunday 17 April (end Week 7) is the last day to discontinue without academic
penalty.

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4. You organise your affairs to take account of examination and other assessment dates
where these are known. Be aware that your final examination may fall at any time
during the semester’s examination period. The scheduling of examinations is
controlled by the University administration. No early examinations are possible. The
examination period for Semester 1, 2011, falls between Friday 10 June and Monday
27 June (provisional dates subject to change).

5. When the provisional examination timetable is released, ensure that you have no
clashes or unreasonable difficulty in attending the scheduled examinations. The final
examination timetable for Semester 1 is released in May (date TBA).

6. Note that the dates for ASB supplementary exams for session 1, 2011 are:
12 July 2011 – exams for the School of Accounting
13 July 2011 – exams for all Schools other than Accounting and
Economics
14 July 2011 – exams for the School of Economics

A full list of UNSW Key Dates is located at:

https://my.unsw.edu.au/student/resources/KeyDates.html

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