Econometrics –II

Paper Code: 
ECO 414 (T)
Credits: 
2
Contact Hours: 
30.00
Max. Marks: 
100.00
Objective: 

The course covers the consequences of and tests for violation of assumptions of classical linear regression model.

6.00
Unit I: 
Multicollinearity

Meaning, reasons, consequences, detection and remedies of the problem of multicolliearity.

6.00
Unit II: 
Heteroscedasticity

Meaning, reasons, consequences, detection and remedies of the problem of heteroscedasticity.

6.00
Unit III: 
Serial correlation

Meaning, reasons, consequences, detection and remedies of the problem of serial correlation.

6.00
Unit IV: 
Specification error

Meaning of model specification, Specification error- omission of a relevant variable; inclusion of irrelevant variable; errors of measurement, tests of specification errors.

6.00
Unit V: 
Qualitative (dummy) independent variables

Nature of dummy variables; ANOVA and ANCOVA models; caution in the use of dummy variable-the dummy variable trap; the dummy variable alternative to the chow test; Interaction effects using dummy variables.

Essential Readings: 

.   D. N. Gujarati and D.C. Porter, Essentials of Econometrics, McGraw

      Hill.

2. Christopher Dougherty, Introduction to Econometrics, Oxford University

     Press.

 3.   Jan Kmenta, Elements of Econometrics, Indian Reprint, Khosla Publishing

      House.

 4.   A. Koutsoyiannis, Theory of Econometric, Palgrave Macmillan.

Academic Session: 
2019-20
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