2nd Batch 7th batch Analysis of Cross-section Data (ECON 405) Course Instructor: Dr.

Rushad Faridi Course objective: This course focuses on the specification and estimation of the linear regression model. The course departs from the standard Gauss-Markov assumptions to include heteroskedasticity, serial correlation, and errors in variables. Advanced topics include generalized least squares, instrumental variables, and simultaneous equation models. Economic applications are discussed throughout the course.

Topics 1. Introduction to empirical modeling Probability theory, probabilistic concepts and real data, notion of non-random samples 2. Review of Regression and related notions Least-Square, finite sample properties, large sample properties of estimators, Inference and prediction, functional form and structural change 3. Inference Problems: Autocorrelation and Heteroskedasticity Heteroskedasticity, Serial correlation, Generalized Least Squares 4. Instrumental variables Motivation, Multiple instruments and 2SLS, IV and measurement errors, Identification problem 5. Simultaneous Equation Models System of equations, endogeneity and causality, methods of estimation Grade Allocation: Final Exam: 50% Mid-term Exam: 20% Term-Paper: 15% Quiz: 5% Assignment: 5%