Attention to HRM 2021-23 Batch of Applied Econometrics for HRM

Take Home Assignment-I

Weight: 20%
Step 1:
Identify a topic of your choice (HRM related) which can be empirically examined using data.
Identify minimum three (max no limit) variables related to it, which you think have a sound
theoretical relationship in real life (preferably some contemporary HR related issues). Identify
one of them as dependent variable(Y) and others as independent variables (X). Since all the
assignment are concurrent, you can select the topic and variable in such a way that, it can be
extended to other two assignments.

Step 2:
Collect the data pertaining to each variable relating to Indian (not necessarily restricted to India
only) context. The number of observations for each data set should not be less than 30
observations. More is preferable and there is no upper limit for the data points. No two
students/group will select the same variables and same data.

Part-A For Two Variable Case (10% weightage)

Calculate the following things and interpret the result with sound theoretical logic.
a. Select one of them as dependent and one as independent variable based on theory.
Estimate the various types of regression model, (out of several functional form) suitable for
your data.
b. Interpret the regression coefficients (do it for all models), covariance of these parameters as
well as R2. Select the best model with appropriate test.
c. Perform suitable hypothesis testing applying ‘t’, ‘F’ and χ2 test to test the hypothesis of the
parameters with appropriate significance level (Only for the best model).

Part-B For Multiple Linear Regression Model Case (10% weightage)

Calculate the following thing and interpret the result with sound theoretical logic.

a) Estimate a multiple linear regression model and interpret the result. Formulate and tests
the hypothesis about the coefficients applying ‘t’, ‘F’ and “χ2 “ test based on your theory
and interpret them. Apply the Normality test on residual term using Jarque-Bera Test.
b) Test the Multicollinearity problem with a suitable method. Solve the problem of
Multicollinearity if so, by any one of the methods which you think suitable for your
example?
c) Applying a suitable method to test Heteroscedasticity problem. Solve the problem of
heteroscedasticity, if so, by any one of the methods which you think suitable for your
example?
d) Tests whether autocorrelation is present or not in your regression? Solve the problem of
autocorrelation, if so, by any one of the methods which you think suitable for your
example?
e) Identify a break point in your data sets and perform the Chow Test to check the stability
between the two periods (parts). Maybe you can perform the Chow test for the dependent
variable.
(Kindly perform all these test even if your data does not suffer from such problem like
multicollinearity, heteroscedasticity, or autocorrelation problem)
Please note
1. The Last date of submission is July 31 2022 EOD. Mail me the soft copy in my mail id
pcpadhan@xlri.ac.in email id. This will not be further extended.

2. Any statistical or econometric software you can use for your estimation.

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