ECN 416 Basic Elements of Research Part 2

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Raising a new Generation of Leaders
ECN 416: Applied Statistics

Department of Economics and Development Studies
Module Six: Basic Elements of Undergraduate Research Project

(Part 2- Methodology)
Lecturer: Dr. Henry Okodua
Outline Covenant University Executive Advance
2016-2017 Academic Session
• Method and Methodology

• How to Choose the Appropriate Methodology
• Describing Your Model
• Model Estimation Technique
• Describing Your Sources of Data
• References
2
Method and Methodology Covenant University Executive Advance
• To begin, it is worth noting that ‘method and

methodology are not the same thing’ (Sikes,2004:15).
• The methodology is the approach taken to the research
design as a whole in relation to reaching answers to the
research question(s),
• Whereas methods are the techniques used to collect and
analyze data to provide evidence for the posited
knowledge that the research constructs.
• Methods are the tools and techniques that are used in
the collection and analysis of data.
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Method and Methodology (cont’d) Covenant University Executive Advance
• Once the most appropriate methodology has been identified, there are likely
to be methods specific to that methodology.
• As with the choice of overall methodological strategy, ‘we should use the
methods that are best suited to answering our questions about a
phenomenon’ (Kincheloe and Berry, 2004:4).
• Within the methodology chapter of a research project, the methodological
approach adopted is articulated and justified, as are the methods – both for
collecting data and for analysis in order to provide evidence for answering
the research question(s).
• A research project’s chapter on methodology should in general, include the
research design and the justification of the choices made, to provide an
understanding of the process undertaken and the reasons for it.
4
How to Choose the Appropriate Methodology Covenant University Executive Advance
• Once the nature of the research has been established and the conceptual
framework formed and the underlying philosophy for the research clarified,
• Decisions can be made about the methodology to be chosen, in line with its
appropriateness for the aims and objectives of the study.
• We should first recall that the review of literature is helpful in identifying key
elements of a research project that will inform the researcher of:
• Existing theory as well as gaps in existing research, and
• Provide background information to enable the formation of an argument for
the need for the research and the shape it will take.
• It also helps with the firming up of the research questions.
• The combination of the above will help in building a theoretical framework
for the substantive aspect of the research.
5
How to Choose the Appropriate Methodology (cont’d) Covenant University Executive Advance
• The background reading will also help to inform the strengths and
limitations of different methodologies that other researchers have
used in the field.
• As existing theory is examined, there will be methodologies
outlined that may prove of interest as useful approaches to consider
for new research.
• As Wilson (2009:59) suggests,
• Analyzing methodologies used by experienced ‘researchers will not
only help you to see what is possible, but
• Will also give you a good insight into the strengths and limitations of
the various methodologies and methods being used’.
• In general, the following steps should be observed
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Describing Your Model Covenant University Executive Advance
• Economic analysis largely concerns the

construction and testing of models.
• Economic models are mathematical equations that
represent a simplified version of the economy or
the decision-making process of an economic agent
such as a consumer or a firm.
• The models are based in part on economic
assumptions, theories, and concepts
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Describing Your Model (Cont’d) Covenant University Executive Advance
• Every model must necessarily have a strong link to

the research title and the specific objectives of the
study
• In the model section, the writer takes the reader
through the series of equation(s) that constitute the
model.
• The writer also state the set of underlying
assumptions that the model is built upon
8
• The description of your model should begin verbally.

• Here is how Paul Krugman, in a famous paper published
in 1991 on economic geography, begins the discussion
of his model.
• “We consider a model of two regions. In this model
there are assumed to be two kinds of production:
agriculture, which is a constant-returns sector tied to the
land, and manufactures, an increasing-returns sector that
can be located in either region.”
9
• You should also indicate the source of the

model.
• Did you construct it yourself, or, as is more
common, was it borrowed or adapted from
someone else?
• Here is how Krugman continues describing his
model:
10
• “The model, like many of the models in both the new

trade and the new growth literature, is a variant on
the monopolistic competition framework [i.e., model]
initially proposed by Dixit and Stiglitz.”
• As you describe your model, its corresponding
mathematical form is presented.
• Krugman’s paper is no exception:
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• All individuals in this economy are assumed to

share a utility function of the form
𝜇 1−𝜇
𝑈 = 𝐶𝑀 𝐶𝐴 ,
• Where CA is consumption of the agricultural good
and CM is consumption of a manufactures
aggregate.
• Note how Krugman immediately defines the
variables in the model—a good example to follow.
12
Model Estimation Technique Covenant University Executive Advance
• Models often contain constants or “parameters”

whose values need to be estimated.
• How will you estimate the parameters?
• What technique will you use?
• You will need to state the statistical technique you
will use - reduced-form regression, two-stage least
squares, etc. - to estimate the parameters of your
model.
13
Model Estimation Technique (Cont’d) Covenant University Executive Advance
• Describing one’s estimation technique often

involves equations;
• To make the equations easier to follow, you
should first explain the notation used in the
equations.
• After introducing the necessary notation, you
should explain your estimation technique in
earnest.
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• Explaining your estimation technique will

require justifying your choice of estimation
technique on the basis of its appropriateness
• You should also identify the strengths and
weaknesses of the chosen technique
• Then, indicate a well thought out plan for
circumventing the known weaknesses
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• The length and detail with which you describe your

methods will be determined by the complexity of
your analysis.
• Did you need to estimate a price function or some
other kind of function?
• Did you have to control for certain fixed effects in
order to avoid potential biases (such as biases
arising from omitted variables)?
• Did you have to weight the data?
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• What about any corrections you had to make for

autocorrelation, which arises when regression residuals for
certain observations are related to residuals for other
observations?
• Or for multi-collinearity, a condition in which your
explanatory variables are not independent of each other?
• Or for heteroskedasticity (i.e., changes in the variance of
errors)?
• You are expected to describe the corrections you made for
any of those problems.
17
Describing Your Sources of Data Covenant University Executive Advance
• One of the innermost parts of an (empirical)

economics paper is the data section.
• In empirical economics papers, it is customary to
describe the data one uses.
• What you tell your readers about your data will
depend in large part on the kind of analysis you are
conducting.
• Generally speaking, however, your data section
should do at least the following.
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Describing Your Sources of Data (Cont’d) Covenant University Executive Advance
• Identify the data source. This means a sentence that

explicitly says where your data come from
• Describe the data source.
• For primary data; you should tell your readers such
things as:
• The number of observations,
• The population groups sampled,
• The time period during which the data were collected,
• The method of data collection, etc.
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• State the strengths and weaknesses of the data

source.
• How do your data compare with other data sources
used in the literature?
• Does yours provide more observations, and/or
more recent observations, than other sources?
• Was the data collected in a more reliable manner?
• Why is the data source particularly suited (or not) to
your study?
20
• Note any features of the data that may affect your

results.
• Were certain populations overrepresented or
underrepresented?
• Is there attrition bias or selection bias?
• Did the method of data collection change?
21
• Explain any computations or adjustments you made.

• Sometimes, a data source does not give you
something directly;
• You perhaps had to add/subtract/multiply/divide
two given pieces of data to get a third.
• Describe in details such needed data
transformation
• Describe also how you constructed your sample.
22
Describing Your Sources of Data (Cont’d)
Covenant University Executive Advance
• Did you have to eliminate certain kinds of

observations, for instance?
• You should pay attention to what aspects of your
data will be most relevant to your project;
• You might devote more space to discussing
your dependent variable than a control
variable.
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• Finding appropriate data often takes a lot of time.

Be wise and allow for enough time to find your data.
• The following sources could be helpful to students;
• Research in Economics;
• World Bank -
https://issuu.com/world.bank.publications/docs/97
81464806834?e=0/35179276
• IMF Financial Statistics
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Describing Your Sources of Data (Cont’d)
Covenant University Executive Advance
• Central Bank of Nigeria Statistical Bulletin

• Commercial Bank Annual Reports - Nigeria
• Nigerian Stock Exchange – Yearbook
• National Bureau of Statistics – Nigeria
• Any other source of data that the student may
consider appropriate.
25
References Covenant University Executive Advance
• Dudenhefer, P (2009). A Guide to Writing in Economics. EcoTeach

Center and Department of Economics, Duke University
• Kincheloe, J. L. and Berry, K.S., (2004) Rigour and Complexity in
Educational Research - Conceptualizing the Bricolage. Maidenhead:
OUP.
• Sikes, P. (2004). Chapter 2 Methodology Procedures And Ethical
Concerns, in Opie, C. (ed.). (2004). Doing Educational Research.
London: Sage.
• Wilson, E. and Stutchbury, K. (2009) Chapter 4 - Research Design And
Ethics. In Wilson, E. (2009). School Based Research A Guide For
Education Students. London: Sage.
26

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www.covenantuniversity.edu.

Raising a new Generation of Leaders

ECN 416: Applied Statistics

Module Six: Basic Elements of Undergraduate Research Project

• Method and Methodology

• To begin, it is worth noting that ‘method and

• Economic analysis largely concerns the

• Every model must necessarily have a strong link to

• The description of your model should begin verbally.

• You should also indicate the source of the

• “The model, like many of the models in both the new

• All individuals in this economy are assumed to

• Models often contain constants or “parameters”

• Describing one’s estimation technique often

• Explaining your estimation technique will

• The length and detail with which you describe your

• What about any corrections you had to make for

• One of the innermost parts of an (empirical)

• Identify the data source. This means a sentence that

• State the strengths and weaknesses of the data

• Note any features of the data that may affect your

• Explain any computations or adjustments you made.

• Did you have to eliminate certain kinds of

• Finding appropriate data often takes a lot of time.

• Central Bank of Nigeria Statistical Bulletin

• Dudenhefer, P (2009). A Guide to Writing in Economics. EcoTeach

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