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This course teaches students how to build econometric models from economic theory to investigate how markets operate, and evaluate policy-relevant questions. Applicants of econometric tools developed in this course will be highlighted in various fields of economics including industrial organization, public economics, health and others. Examples of topics covered include: firms’ use of price discrimination as a profit-maximizing strategy; measuring the welfare effects of mergers for antitrust analysis; identifying strategic interaction amongst governments and its impact on policy decisions; and quantifying moral hazard and adverse selection in health insurance markets. Basic topics in numerical analysis will also be covered, including optimization, numerical integration, and numerical differentiation. The computer software used is MATLAB.
Intended learning outcomes
On successful completion of this subject, students should be able to:
- Estimate structural econometric models and use counterfactual analysis to assess policy questions
- Understand basic identification challenges in estimating the parameters of economic models
- Learn basic programming skills and numerical methods
- Apply methods learned in the course to address policy questions for an industry.
On successful completion of this subject, students should have improved the following generic skills:
- High level of development: written communication; problem solving; statistical reasoning; application of theory to practice; interpretation and analysis; critical thinking; synthesis of data and other information; evaluation of data and other information; use of computer software; accessing data and other information from a range of sources; receptiveness to alternative ideas.
- Some level of development: collaborative learning; team work.
Last updated: 29 July 2022