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Econometric Lecture Notes (1)
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Lecture notes of 23 pages for the course Financial Economics at LE
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Department of Economics EC2010University of Leicester
Lecturer: Dr M Gil-Molto
1: Basic principles
1. Single equation regression models. The true regression equation
2. Linearity
3. Stochastic error term
4. Multivariate case
5. Causality and explanation
6. The estimated regression equation
7. Examples
Basic Reading:
Studenmund Chapter 1
, Learning Outcomes
At the end of this lecture, you will be able to
Formulate regression models (independent
variable and regressors)
Distinguish between the theoretical and the
estimated regression model
Understand the meaning of the
coefficients/estimators
Understand the concept of “error” and identify its
sources
Understand the concept of “residual” and
distinguish it from the concept of “error”
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