The assignment for EC2013 is an individual project. It is based on the estimation of a multivariate ordinary least squares regression: Department of Economics Assignment, UCC, Ireland

Assignment

The assignment for EC2013 is an individual project. It is based on the estimation of a multivariate ordinary least squares regression. You have been assigned a country and this is indicated on canvas. Check that you have been assigned a country and if you have not been assigned a country contact the lecturer immediately.

Doing the analysis on a country you have not been assigned will result in you receiving a zero grade. You are to obtain data on GDP, Capital Stock, and Labour from the Penn World Tables. The data to download has been highlighted in Appendix 1 of the assignment. You should download data from 1950 to the most recent year available for your data.

Using the data you have downloaded you are to complete the following:

a) Specify the model you will be estimating. You wish to assess the effects of capital stock and labor on GDP. All variables should be logged.

b) Outline your theoretical hypotheses detailing (i) your expectations for the signs of the variables and (ii) how the model chosen allows you to test your hypotheses. Justify your answers with reference to the relevant literature.

c)Describe each of the variables in your model and how they behave over time. Present any other descriptive statistics that you feel are justified. Do you anticipate any other problems associated with your data?

d)Estimate your model using the data provided and present and interpret your final results. You should use economic theory to help you explain the observed results.