Practical Econometrics

An empirical economist can hardly avoid understanding and interpreting econometric analysis, let alone doing it. This book aims to help economists facing practical problems in their applied work. It discusses the circumstances under which a method can be used, its properties, and the situations, where it may be useful or where it is misleading. Most methods presented in this book are easily applicable in practice, thought many are not covered in undergraduate texts. The focus is on the practical use of the methods. An important question is usually not how the estimator or test statistic can be computed, since modern software packages efficiently perform the necessary comutations, but when a method should be used and how the results be interpreted. The software review contained in the Appendix gives information on suitable packages for applying the methods discussed in the main text.