econometrics

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Econometrics

The quantitative science of modelling the economy. Econometric models help explain and predict variables of interest.

Econometrics

The use of mathematics to assess economic data. There are two broad subdivisions in econometrics. Theoretical econometrics uses statistics to find strengths or weaknesses of an economic model considered on its own terms. Applied econometrics, on the other hand, considers how well a model conforms to real life data. For example, one may look at average wages for those with different levels of education to determine whether or not higher education is cost effective.

econometrics

the application of statistical techniques in the analysis of economic data. Econometrics is used extensively in establishing statistical relationships between, for example, levels of national income and consumption in the economy, as a basis for formulating government ECONOMIC POLICY, and is used by firms to forecast demand for their products. See SALES FORECASTING, REGRESSION ANALYSIS.

econometrics

the discipline within economics that attempts to measure and estimate statistically the relationship between two or more economic variables. For example, economic theory suggests that consumption expenditure is a function of disposable income (C = f (Y)) or, more precisely, that consumption expenditure is linked to disposable income through the equation C = a + b.Y. For each level of disposable income, consumption can be measured and a statistical relationship established between the two variables by making numerical estimates of the parameters, a and b in the equation. Because consumption is dependent upon income, it is termed the DEPENDENT VARIABLE, whilst disposable income is termed the INDEPENDENT VARIABLE. Econometric models can have many hundreds of measured variables, linked by several hundred estimated equations, not just one, as is the case when models are constructed for macroeconomic FORECASTING purposes. See REGRESSION ANALYSIS.
References in periodicals archive ?
Again, if econometricians fully understood the endogeneity they confronted, this wouldn't be an issue.
Suppose an econometrician has access to a sample of data from this DGP, but does not know the true form of the underlying model.
Basmann, "The Professional Responsibility of the Econometrician for Truthfulness in the Teaching of Economics," in Educating Economists, eds.
The door of his home was always open to visitors, and a large number of econometricians and friends over the years had a chance to enjoy the warm hospitality of Clive and his wife Patricia Lady Granger.
I was not fond of the dry tools of linear algebra used by Fisher and other econometricians to study identification of simultaneous linear systems.
Unfortunately for econometricians, government spending during those wars was not increased in isolation: both also featured major tax increases and (especially World War II) the use of command-and-control measures.
A more academically oriented economics book would probably not have apologized for statistical technique in making the same point, or relegated these studies to Chapters 11 to 14 at the end, but this book is primarily aimed at activists, not econometricians.
Econometricians (nope, me neither) have been studying the Playboy archives (nope, me neither) and discovered that when times are hard and money is tight, the males of our species prefer older, taller, more muscular women.
The best way I can illustrate this idea is to relate the story of the three econometricians who went hunting one day.
If such efforts were made, I am sure one group of brilliant econometricians would find a causal linkage which showed that oil price movements were caused by changes in the exchange rate while a second equally brilliant group would find the reverse.
Therefore, following Campbell and Shiller (1987) and Engel and West (2005), the exchange rate is likely to embody important information about future commodity price movements well beyond what econometricians can capture with simple time-series models.
Econometricians are left with the difficult task of isolating the effect of a funds rate increase on variables such as output and inflation.