economics questions for Michael

Eco 490, Haskell Spring 201 7 Research Project Information Packet 1 A. General Tips for Getting Started  Start with a broad topic , but work to refine your research question by (1) geographic location , (2) time period , (3) specific event, (4) specific policy change, (5 ) demographic group, or (6) some combination of these.  As you begin researching a question, keep track of related questions that arise as you go. Eventually one of these questions will be your final research question, but seldom is it the one you started with.  Look seriously at journal artic le sources on a given topic before you have a clear question . Research is an itera tive proces s – a topic , some reading, a question, more reading, other questions, more reading, more questions, etc.  Browse data sources to see what type of information is available. Sometimes variables or trends in data can spark interesting questions.  Keep the research project in the back of your mind… news articles, other classes, and casual conversations can spark great research questions. B. Journal Resources  Google Scholar  EconLit  Economic encyclopedias  New Palgrave Dictionary of Economics  International Encyclopedia of the Social and Behavioral Sciences  Handbook chapters (e.g., Handbook of Labor Economics)  Published literature reviews ( especially useful for finding other sources and identifying open questions in the literature )  Journal of Economic Literature  Journal of Economic Perspectives (very undergraduate accessible ) Tips :  Read the abstract, introduction, concl usion, tables, and then the “meat” of an academic journal article – this saves time and increases comprehension relative to reading “front -to -back” as you would a novel .  Look at the citations listed in a given article to find related, possibly more releva nt articles .  In Google Scholar, che ck the “cited by” link to find newer, related articles that cited a given article Eco 490, Haskell Spring 201 7 Research Project Information Packet 2 C. Some Publically Available Data Resources (this is my no means an exhaustive list and students should not feel constrained to the items here. )  Macroeconomic Data  FRED (Federal Reserve Bank of St. Louis: Federal Reserve Economic Data)  International Data  Penn World Tables  National Trade Data Bank  U.S. Microeconomic Data  CPS (Current Population Survey)  PSID (Panel Survey of Income Dynamics)  SIPP (Survey of Income and Program Participation)  HRS (Health and Retirement Study Panel Survey of Income Dynamics)  U.S. Government S ources  Census Bureau  Burea u of Economic Analysis  Bureau of Labor Statistics  National Center for Health Statistics D. Final Paper Guidelines (See syllabus for directions on early stages such as the proposa l!) I. Introduction (≈½ - 1 page )  Motivate the question… Why is your paper interesting/worth reading?  State the research question(s)… In general , what hypotheses are you testing?  Explain, in broad strokes, how you plan to answer the question.  Briefly summarize your key findings and relate them to important policy issues and/or the broader literature .  Give a “roadmap” for the remainder of the paper II. Literature Review (≈1- 1.5 pages)  Discuss other studies on this topic, and relate each article to your a nalysis .  To the extent possible, f ocus on methodology, data, and results (not just results)  Note whether your study brings up new ideas or expands on old ones.  Refer to authors, not paper names (e.g., “Goldin and Katz (2000) argue that… “).

The title of the paper does not need to appear anywhere except the works cited . Eco 490, Haskell Spring 201 7 Research Project Information Packet 3 III. Model (≈1 .5 pages)  Verbally and mathematically describe and explain the theory you’re analyzing. Focus on the dependent variable and key independent varia bles .  Note the general variables in your model (e.g., Y = f(x1, x2, x3…) and briefly why they are needed and whether the affect the outcome positively or negatively.  For key independent variables, make predictions about the signs of marginal effects (consider second derivatives and cross -partial derivatives as needed). Where appropriate, make any significant predictions about magnitudes (e.g., elastic or inelastic). Justify the predications based on economic theor y.  Specify and justify the specific econometric model (regression equation) . Given the theory above, discuss the appropriate functional form and methodology (linear, log -linear, OLS, fixed -effects, instrumental variables, etc.)  Express the theory in ter ms of testable hypotheses from the primary regression equation. Note any other relevant hypotheses (e.g., changes in the magnitude of coefficient estimates for a specific subsample relative the primary specification).  Note any restrictions to your analysi s (e.g., simplifying assumptions imposed between the theory and the empirical model, or ideas that aren’t testable due to data constraints) IV. Data (≈½ - 1 page)  Name the data source(s) and give salient characteristics and background info.  Note whether the data are a cross -section, time series, or longitudinal.  Discuss whether the data are appropriate. (Do data correspond to theoretical variables? Are the sources reliable and unbiased?)  Describe and justify any selection criteria used to narrow the sample.  Provide information on variables names, units of measurement, and key summary statistics. Note any anomalies or interesting features of the data.  Discuss potential problems that could affect the analysis (e.g., multicollinearity) Eco 490, Haskell Spring 201 7 Research Project Information Packet 4 V. Empirical Results (≈1.5 pages)  Present and interpret your coefficient estimates. Discuss your results and compare them to your predicted hypotheses. Did results match predictions?  Address sign, magnitude (economic significance), and statistical significance. Focus primaril y on your fina l regression model, although address any secondary regression models as they relate to hypotheses presented in the model section.  Evaluate the explanatory power of your final model, including R 2, adjusted R 2, AIC, and any necessary consider ations based on the error term analysis. (The error term analysis should consider issues such as normality, autocorrelation, heteroskedasticity, and the influence of outliers ).  Discuss whether data limited your conclusions or ability to test hypotheses . VI. Robustness (≈½ page)  Present additional estimates to convince readers that your findings are “real.”  To the extent possible, address any concerns regarding omitted variables, alternative theories, biases in the data, sensitivity to outliers, endogeneity, etc. VII. Conclusion (≈½ - 1 page)  Briefly summarize your method and empirical results. Attempt to reconcile any differences between your predictions and the results.  Put your findings in perspective relative to the literature. Attempt to reconcile any diff erences between your results and the literature.  Highlight the importance of your study. What does it add to existing knowledge?

What important implications does it have for policy and/or for the literature?  Discuss how your research could be extended in the future. What is the next step in studying this theory? Abstract (≈ 100 word s)  State your specific research question(s), and b riefly explain your contribution to existing knowledge on the topic.  Summarize your method, data, and empirical results. References  Use any standard, accepted for mat for the works cited (e.g., APA) .  Citations should include at least 5 peer reviewed journal articles. Eco 490, Haskell Spring 201 7 Research Project Information Packet 5 E. Table Guidelines (Example formatting ) Table 1A : L ist of Variables Dependent Variable: Wages Key Independent Variables: Years of Experience Years of Schooling Other Control Variables: Gender Race (Black or White) Ethnicity (Hispanic) Dangerous Industry/Occupation Innate ability Notes: This is not a typical table to include in a paper, but will help facilitate model development after the initial proposal. A list of a variables might appear in an appendix with variable definitions. This is designed as an example, not necessarily a fully -specified regression. Table 1: Testable Alternative Hypotheses Econometric model : = 0+ 1+ 22+ 3+ 4+ 5+ 6 + 7 + 8 + Predictions : ⁄ ⁄ ⁄ Dependent Variable : Wages (w) Key Independent Variables : Experience (E) 1+ 22̅> 0 1> 0 2< 0 n.a. Schooling (S) 3> 0 3+ 6 > 0 n.a. 6< 0 Other Control Variables : Female (F) 4> 0 n.a. n.a. Black (B) 5< 0 n.a. 6< 0 Hispanic (H) 7< 0 n.a. n.a. Dangerous job (D) 8> 0 n.a. n.a. Notes: For experience, the second derivative is actually 22 but we can ignore the constant 2 for the sake of predicting signs. In particular, note that “innate ability” appeared in Table 1A because we think it likely affects wages. However, “innate ability” do es not appear in Table 1 because there is no appropriate variable to control for innate ability. If the data set included an appropriate proxy variable (e.g., IQ score) then we could include it. Or, if we had panel data, we could use individual fixed effec ts to control for innate ability. (As you can see here, use table footnotes to clarify any necessary issues. Again, a table of this form is not used in published papers, but will facilitate early stages of research and model development.) Table 2 : Sample Statistics Mean Standard Deviation Minimum 25 th percentile Median 75 th percentile Maximum Wages (w) Experience (E) Schooling (S) Female (F) Black (B) Hispanic (H) Dangerous job (D) Notes: Sample size includes 2,880 observations. ( Use as needed for relevant information .) Eco 490, Haskell Spring 201 7 Research Project Information Packet 6 Table 3: Empirical Results Dependent variable: wages OLS Fixed Effects Experience 1.47*** (0.39) Experience squared Schooling Female Black Black*Schooling Hispanic Dangerous job Constant Number of Observations 2,880 R2 Number of Individuals 0.46 1,440 Notes: Robust standard errors are reported in parentheses below each coefficient estimates. One, two, and three asterisks indicate statistical significance at the 10 -, 5-, and 1 -percent level, respectively. ( Obviously the table would be appropriately filled in y our version. The final regression re sults might include two, three, or four, main specifications – here I have shown one OLS specification and one Fixed E ffects specification, where fixed effects are used to control for innate ability. Depending on the spe cifications, different information should appear in the bottom rows. For instance, if my specifications included dropping or adding independent variables, I should report R 2 and adjusted -R2. If comparing models, I might consider including the AIC. ) Table 4: Error Term Analysis Initial Model Final Model Error Normality Autocorrelation Heteroskedasticity Key outliers or influential observations Notes: Details are omitted because this table will differ substantially by student and might only include results from specific statistical tests . Appropriate error term tests will vary depending on the regression and data set. The final model includes all variables and the appropriate functional form. The initial model might be a simpl er functional form, have fewer variables, and/or have yet to correct for autocorrelation , etc. Eco 490, Haskell Spring 201 7 Research Project Information Packet 7 Table 5: Robustness Dependent variable: wages Log -Linear Alt. Model 2 Alt. Model 3 Experience Experience squared Schooling Female Black Black*Schooling Hispanic Dangerous job Constant Number of Observations R2 Notes: Robust standard errors are reported in parentheses below each coefficient estimates. One, two, and three asterisks indicate statistical significance at the 10 -, 5-, and 1 -percent level, respectively. ( Obviously the table would be appropriately filled in y our version. Here, report regression results that can be compared to Table 3. For instance, one alternative model might consider log -linear instead of linear regressions in wages to see if results are robust. I might consider adding other explanatory varia bles or splitting the sample. Formatting should follow that of Table 3, but details will differ substantially by project.) F. A Couple of Reference Guides for Writing an Empirical Economics Research Paper Van Gaasbeck, Kristin A. 2007. Writing in Economics: Components of a Research Paper . Department of Economics, California State University, Sacramento, www.csus.edu/indiv/v/vangaasbeckk/resources/writing/comp.htm . (Accessed 1/24/2016). Dudenhefer, Paul. 2014. A Guide to Writing in Economics . Department of Economics, Duke University. https://econ.duke.edu/uploads/m edia_items/a -guide -to-writing -in- economics.original.pdf . (Accessed 1/24/2016).  Th e PDF for this source is also on Isidore under our reading folder. I strongly suggest reading Part II (all sections), Part III (all sections), and Part IV (sections 18 -23).