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What Is Econometrics?

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Question: What Is Econometrics?
There are many ways to define econometrics, with the simplest being "statistical methods used by economists". Econometrics is a set of statistical tools that allows economists to test hypotheses using really world data. "Is the value of the Canadian Dollar correlated to Oil Prices?", "Does fiscal stimulus really boost the economy?", "Has the gap between the rich and poor grown since World War II?". Others may define it slightly differently - below are a few definitions provided by other economists.
Answer: Here are a few definitions of Econometrics that should help you answer the question "What is Econometrics?":

Perhaps the simplest answer to the question "What is Econometrics?" can be found at Monash University. They state that "Econometrics is a set of quantitative techniques that are useful for making "economic decisions".

What is Econometrics - Other Perspectives

The website Pitmaster.com answers the question "What is Macroeconomics" with the following response: "[Econometrics is the] application of statistical and mathematical methods in the field of economics to test and quantify economic theories and the solutions to economic problems."

The Economist's Dictionary of Economics defines Econometrics as "The setting up of mathematical models describing mathematical models describing economic relationships (such as that the quantity demanded of a good is dependent positively on income and negatively on price), testing the validity of such hypotheses and estimating the parameters in order to obtain a measure of the strengths of the influences of the different independent variables."

What is Econometrics - Econometric Modeling

The Economics Glossary defines "Econometric Model" as follows: "An econometric model is an economic model formulated so that its parameters can be estimated if one makes the assumption that the model is correct". Now you know what Econometrics is, you may want to visit these useful resources on Econometrics:

The Econometrics Resource Center has a great deal of information on econometrics topics. If you're a student who is required to complete an econometrics project, please see the following articles:

If you're in an econometrics course, you'll also want to see the article How To Ace Your Econometrics Test.

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