1 ST DAY OF CLASS 1 ECONOMIC STATISTICS 1st Semester 2013/2014 INTERNATIONAL BUSINESS AND DEVELOPMENT 0. PPT day

Textbooks Textbooks!! Required  C. DOUGHERTY, Introduction to econometrics (fourth edition), Oxford University Press, 2011, Only the following chapters: 1,2,3,4,5,6,7 E. GIOVANNINI, Understanding Economic Statistics. An OECD perspective, OCSE, 2008, Paris ( E. GIOVANNINI, Understanding Economic Statistics. An OECD perspective, OCSE, 2008, Paris ( Only the following pages ( Chapter 2: pp , Chapter 3: pp.66-76, Chapter 4 pp and pp )  G. GOZZI, Economic Statistics (part one and part two), Slides on all topics of the course (available at photocopying office)  Also, visit   Further readings will be supplied during the course 0. PPT day

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SLIDES 0. PPT day

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As prerequisites  Recommended - 2 undergraduate courses in statistics in addition to a good command of algebra. You should have some notion about what random variables are, what a probability distribution is, what a statistic is, and what a hypothesis test is.  These are things that we will cover, but we move through them quickly. If you haven’t learned about these before, you’ll never be able to keep up. Previous experience of linear regression is not a prerequisite but would be very helpful. 0. PPT day

Communication Skills for IBD This year you have the possibility to follow: Workshop «Introducing economics and statistics in English» Statistics: Dr. Lara BERZIERI 0. PPT day

TIMES OF LESSONS Monday classroom K1 Tuesday 9-11 classroom K1 Wednesday 9-11 classroom K1 0. PPT day

Office hours Tuesday Wednesday PPT day

General Rules I do not collect signatures for attendance. Those who are not interested can stay in bed, go to the park or the bar. 0. PPT day Do not talk. If you have questions, I am here to listen. Students who disturb the class will be asked to leave the classroom. Please!! Turn off mobile phones

Quiz and participation in class But Attendance is crucial  Class and quizzes cannot be made up  Will go over all software in class Other than this, participation in class also encouraged by participation grade Both are gifts to the conscientious student  Designed with student in mind 0. PPT day

Assessment methods Written final exam. The oral examination is optional - after the compulsory written exam for students who pass the written exam (at least 15/30)- and might increase or decrease the overall result 0. PPT day

Grades Your grade in this class will be based on your performance in the final exam and on result in works in Group or Empirical Assignments during the period of lessons. The final assessment, for students who pass the written exam (at least 15/30), is the sum of the vote in the written exam and the scores (between 0-5) on work groups. 0. PPT day

Nature of Economic Data  Generally not handed to us, or experimental, but takes time, money and effort to collect and disseminate By some computer assisted bureaucracy, now  Economic data, more or less accurately, measure some economic phenomenon  Are a given in the sense that, once obtained, they cannot be altered In this sense, serve as our knowledge of economic reality 0. PPT day

Economic Data Economic Statistics wants to explain social phenomena and be applicable  Requires knowledge of history, politics, institutions, economic theory and DATA  “Data:” etymology from the Latin, dare, to give (singular datum, plural data) 0. PPT day In Chapter two are presented the MAIN PRODUCERS OF STATISTICAL DATA: NATIONAL AND INTERNATIONAL SOURCES

Software No prior knowledge of any software required Hands-on instruction on your laptop of all software used: GRETL and Excel Main program GRETL was written by Prof. Cottrell.  Is free to the user and continuously updated 0. PPT day

Class and Text Reading Schedule Please not that the syllabus is an outline of topics I wish to cover - I may not cover all of them - and I may not cover them in the order listed. It is VERY IMPORTANT to keep yourself informed about what is going on in the class at a particular time. Again, it is important to bear in mind that parts of each class will be spent on discussing problems that I will assign from time to time or in answering questions. It is very important that you keep up with the material and take part in class discussions. I want this to be a semester long dialogue between us. Please feel free to ask questions during class and before the lecture starts and/or after it ends. 0. PPT day

0. PPT day How do we define our course Economic Theory Economic Statistics Economic Statistics Methodological Statistics Methodological Statistics Methods Data Testing Theory Forecasting Policy Advice Theory Economic theory makes statements or hypothesis that are mostly qualitative in nature. For example they would say that increased income would increase consumption. This Economic theory postulates a relationship but does not provide any numerical measure of relationship between the two.

1. Statement of Theory or Hypothesis  Keynes states that on average, consumers increase their consumption as their income increases, but not as much as the increase in their income (MPC < 1). 2. Specification of the Statistical Model of Consumption (single- equation model) Y = β 1 + β 2 X 0 < β 2 < 1 Y = consumption expenditure and (dependent variable) X = income, (independent, or explanatory variable) β 1 = the intercept β 2 = the slope coefficient  The slope coefficient β 2 measures the MPC ( Marginal Propensity to Consume) PPT day

 Geometrically, PPT day The results can be viewed in a Cartesian diagram

WHY IS ECONOMIC STATISTICS A SEPARATE DISCIPLINE? The subject deserves to be studied in its own right for the following reasons:  Economic theory makes statements or hypotheses that are mostly qualitative in nature (the law of demand), the law does not provide any numerical measure of the relationship. This is the job of the economic statistician or the econometrician.  In English-speaking countries econometrics and economic statistics are two different disciplines.  Econometrics is mainly interested in the empirical verification of economic theory.  Economic statistics is mainly concerned with collecting, processing, and presenting economic data in the form of charts and tables.  But in Italy economic statistics also deals with the empirical verification of economic theory PPT day

Course Material  Remember No text only slides  All readings posted on the website or handed out in class  Website should become familiar to students   Become familiar with it 0. PPT day

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Features of gretl Easy intuitive interface (now 6 languages) A wide variety of least-squares and maximum-likelihood estimators, including systems estimators Single commands to launch procedures: 0. PPT day

Features of gretl Best of all it’s free! Open source philosophy – You are free to download and use gretl – You are invited to contribute additional features to the gretl project 0. PPT day

Accessing gretl Access to gretl can be found at the website: which provides instructions on downloading the program and reference manuals. 0. PPT day

0. PPT day Recommended readings  L. C. ADKINS, Using Gretl for Principles of Econometrics, 3rd Edition. Version 1.311, 2010 (  Manual for doing the computer exercises in Dougherty, C. Introduction to Econometrics (Oxford: Oxford University Press, fourth edition 2011) using gretl e/01student/gretl/gretlmanual.pdf e/01student/gretl/gretlmanual.pdf Teaching methods Lectures and tutorials using Gretl:  

Accompanying datasets On gretl homepage, click on “data for gretl” to see list of available datasets for teaching and research: Datasets from econometrics textbooks Large macroeconomic datasets from St. Louis Fed, Penn World Tables Other specialized data sets. 0. PPT day

0. PPT day questionnaire to fill in