Major Assignment

ECON3210 Section O
Laura Salisbury
Winter 2015

Assignment Details

Summary
You will analyze the relationship between two economic variables of interest using the tools
acquired in the course. You will identify a research question, and then identify an appropriate
data source, which you will use to answer this question. For example: What is the effect of
family size on labour supply? What is the effect of crime rates on house prices? What is the
effect of inflation on exchange rates? Your topic can cover any area of economics just pick
something you find interesting!
You may work in pairs, but you dont have to. Your topic must be approved by me ahead
of time. Your assignment paper should contain all the required components listed below. It
should not exceed 2000 words, excluding tables, figures, and references. The assignment is
due on March 19th by 11:59pm, and must be turned in via the course website. Late
assignments will be penalized according to the following rule: a paper that is D business days
late will lose 5(ln(D) + 1) points. Assignments will not be accepted after April 6th.

Topic Approval
You and your partner (or just you if youre working alone) will sign up for a meeting with me
using the scheduler on the course website. Meetings will be 5 minutes long, and will be held
on February 2nd, February 3rd, and February 6th. We will use this meeting to discuss
your topic and appropriate data sources. You should bring a short, one paragraph description
of your topic to this meeting include the names of both group members (if applicable) on
this sheet.

Statistical Software
You will be required to use statistical software to complete this assignment. You can use any
software you are comfortable with and have access to. I will be most helpful to you if you are
using Stata, since this is what I use in my own work. You will be given access to Stata through
the undergraduate computing lab in the economics department (Vari Hall room 1059). This
lab is open from 8:30-4:30, so plan accordingly! Your York ID (the beginning of your york
email address) will be your user name, and your student ID number will be your password.

If you are familiar with R, you can use this program instead it can be downloaded free of
charge onto your personal computer.

Ideas for Data Sources

The following is a list of data sources to get you started. You do not have to use one of these
sources, but they will give you a sense of what is available:
IPUMS is a great, user-friendly source for micro-level data from all over the world:
http://www.ipums.org
ICPSR is another large data source, containing data on a variety of topics from various
countries: http://www.icpsr.umich.edu/
Statistics Canada has data on a variety of topics, aggregated to the national or provincial
level: http://www.statcan.gc.ca/
The Bank of Canada publishes a number of aggregate statistics: http://www.bankofcanada.
ca/

Required Components

Your assignment paper should include all of the following components. It should not exceed
2000 words, excluding tables, figures and references.

Introduction
In this section, you should clearly identify the research question you are trying to answer.
Why is this an interesting question? What else has been written about this question? How
does it relate to economics?

Description of Data
Describe your data source in detail. This involves answering the following questions:
Why is this an appropriate data source with which to answer your research question?
Which organization is responsible for the creation of your dataset? Did you merge
multiple data sources? If so, what are they?
What kind of data are you using? (i.e. cross-section, panel, time series)
How was your dataset created? (i.e. survey, administrative, etc)
What is the unit of observation in your dataset? (i.e. person, household, country,
province, industry, year, etc.)
How big is your sample? Have you imposed any restrictions on your sample? What are
they?
What did you do to clean your data?
2

 What are your primary variables of interest? How are they defined? Are they indicator
variables?
What control variables are you using? How are they defined? Are they indicator variables?
Are there any other unique features of your data I should be aware of? For example,
are any of your variables top coded? Are any values imputed?

Econometric Model
Describe the econometric model you are using to answer your research question. This involves
answering the following questions:
What kind of a model are you using? Which variables does it contain? Does your model
include any interaction variables?
Why do you think this model is appropriate for answering your research question?
What are some of the potential pitfalls associated with this model? For example, are
there omitted variables that might bias your results? Are any of your variables collinear?
You should suggest an appropriate way of addressing any of the challenges with your
approach that you identify.
What does economic theory predict about the sign or magnitude of your coefficients of
interest?

Results
Present your results in this section. You should begin by presenting a table of descriptive
statistics for your data (such as means, standard deviations, minima and maxima for the
variables you will be using in your analysis). You may also include descriptive figures if
appropriate. Estimate your econometric model, and present the results. You should address
the following questions:
What are you estimated coefficient(s) of interest? What do they mean?
Are your main results significant? Provide appropriate confidence intervals.
Is you model significant? Show supporting statistics.
How much explanatory power does you model have? How well does the model fit your
data?
How sensitive are your core results to including and excluding different control variables?
What does this tell you?
Is there any evidence of heteroskedasticity in your error terms? What happens when
you estimate heteroskedasticity-robust standard errors?

Discussion and Conclusion

Discuss the meaning of your results, with reference to your research question. Did you find
what you had expected to find? Why or why not? Discuss any challenges there might be in
interpreting your results as causal.

List of References
All secondary sources you use during your research should be cited in your assignment paper
and then included in a list of references at the end. For a guide to citation styles, see:
http://researchguides.library.yorku.ca/styleguides

Grading Rubric

Grade Item
Topic proposal & meeting
Following instructions
Justification of research question and appropriateness of data source
Demonstrated understanding of data source
Demonstrated understanding of econometric theory and methods
Clarity of arguments, writing, and presentation of data

Weight
5%
5%
15%
20%
35%
20%

Tips
Start early! This assignment will be time consuming, and it will be impossible to do a
good job if you leave it to the last minute. Moreover, space in the computer lab is highly
limited, so you will not all be able to cram in to complete your assignment on the last
day.
Seek help! If you are having trouble doing something in Stata, or if youre having trouble
interpreting your results, ask me or the TA for help.
When choosing your topic, keep in mind that you need to be able to find adequate data
to analyze. For the purposes of this course, you should have at least 100 observations in
your dataset.