ECONOMETRICS 2015

TERM PROJECT MAKING SHEET

Group members: (As on the
report)
................................................................................................................................................................................................................................................................
Group number: . Tutorials: Tutors name:
Topic:
................................................................................................................................................................................................................................................................
I. Report marks: ______________________/ 20 marks
Relative marked components (max)

Marks

Comments

1. Language - 2 marks
2. Design - 1 mark
3. Reference - 1 mark
4. Introduction & Conclusion - 2 marks
5. Model specification 5 marks
a) Theory - 2 marks
b) Choice of variables - 2 marks
c) Functional form 1 mark
6. General tests 4 marks
a) Significance test (t n F) - 2 marks
b) Interpretation 2 marks
7. Errors checking procedures - 5 marks
a) Multicollinearity 2 marks
b) Heteroscedasticity 2 marks
c) Autocorrelation 1 mark
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8. Bonus (if any)

II. Presentation marks: ________________________/20 marks

Relative marked components (max)

Marks

Comments

Content of the presentation 8 marks

Purpose of presentation 2 marks
Logical Structure 3 marks
Explanation and outcome 3 marks
Visual Aids and graphic displays 2 marks
Language 5 marks
Q&A sections 5 marks
Bonus (if any)
Timing (-1 marks if overtime)

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Additional Guideline
Heteroscedasticity testing:
After running Regression Analysis, you can use White heteroscedasticity test to examine whether
there is the existence of this error.
How to do:
Click on View., choose Residual Diagnostics, then click on Heteroskedasticity test. In Test type,
choose White (you can look at the description below). In here, you are recommended to use Crossterm test, so keep the tick on option of Include White cross terms. After all, click OK. The result of
the test will show up. Your job now is using what you have learnt to make a conclusion.

Reducing the effect of Heteroscedasticity using White Heteroskecasticity-consistent standard

errors & covariance
White Heteroskecasticity-consistent standard errors & covariance is the alternative method (or
estimation) that does not have the assumption about Heteroskedasticity.
How to do:
From the original result of the regression, click on Estimate, the Estimation Equation window will pop
up. Then choose the Option tab. At Coefficient covariance matrix, choose White. Then click OK.
(you can look at the description below). After clicking OK, the result of alternative estimation will
show up

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Autocorrelation Testing:
Test of AR(1) process: You can use d.Durbin-Watson test to examine the autocorrelation (first-order).
By using Durbin-Watson stat obtained from the result of regression analysis, you should be able to
perform the test
Test of higher order autocorrelation: You can use Breusch-Godfrey (BG) test
How to do:
Click on View, choose Residual Diagnostics, then choose Serial Correlation LM Test, the Lag
Specification window will pop up. Depending on your choice, you will choose the level of lag that
you want to perform in the test. Then click OK. From the result given, you should be able to perform
the test based on what you have learnt

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