1
Q
what is the issue with drawign supply and demand curves
A
We only iobserve the price and quantity pairs
We don’t observe the supply and demand curves directly
2
Q
If we estimate the demand curve by OLS, what would be the result?
A
Regression with ln(P) as the outcome and ln(Q) as the regressor results in a single regression line
3
Q
Why doesn’t the OLS regression of
ln(Pi) = a_s + B_s + n_si
work
A
They are simultaneous equations, as P and Q are simulataneously determined by each other
Two parameters that explain the rs between P and Q
4
Q
What is a structural equation
A
They show the structure (theory) of the system
5
Q
A
Key Points:
- Assume rs
- Simultaneity issue; explain with second equation
- Data is realised pairs
- OLS doesn’t isolate a single mechanism; ‘bundles both’
- Describe bias
6
Q
A
7
Q
A
EC2C3
flashcards
Decks in class (33)
# Cards
-
EC2C312
-
Simultaneity/Reverse Causality7
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EC2C3 Notes210
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1. Causality and Correlation19
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3. Experiments16
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2. Potential Outcomes + Counterfacturals10
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4. Experiments then Standard Errors16
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5. Statistical Inference13
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6. Bivariate Regression15
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7. Algebraic Properties, Reparameterisation23
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8. Standard Errors in Bivariate Regression21
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9. Multivariate Regression17
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10. OVB19
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11 R^2 and Regression Anatomy14
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12. Multivariate Inference13
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13. Functional Form in Regression25
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14. Dummy Variables12
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15. Interactions12
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16. Bad Controls and Multicollineraity22
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17. Measurement Error19
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18. Missing Data, Internal Validity, External Validity19
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19. IV: Definitions and Assumptions21
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20. Two Stage Least Squares (2SLS)26
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21. More 2SLS: Wald, Generalising, Confounders27
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Even More 2SLS: Variables, Overidentified, Residuals and SE28
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past q review0
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23. Understanding Instrumental Variables15
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24. Simultaneity/REverse Causality I24
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25. Simultaneity/Reverse Causality II26
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26. Panel Data, First Differences and Fixed Effects28
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27. DiD (Difference in Differences)27
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28. Regression Discontinuity22
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Exam PRactice REvision105
