Question
Do I need to use econometrics when completing my dissertation and what do I need to remember when using econometrics?
Answer
The answer is it depends. Whilst at some universities it is compulsory to use statistics and econometrics methodology, most universities only recommend that you use econometrics and statistics if you are 100% confident on how to apply them. However, because contemporary economics is heavily based on mathematics, you will be required and expected to demonstrate high level of numerical and technical competency. If econometric methods are applied effectively, then there are marks to be gained, but remember, for most universities it is not compulsory to use econometrics. If not, then it is imperative that you still use data which can be visually presented through graphs, charts and more.
When using econometrics, remember that diagnostic testing has become an integral part of model specification in econometrics. Some of these advances involve new insights into older diagnostics, such as the Durbin-Watson statistic, Ramsey’s regression error specification test (RESET), general Lagrange multiplier (LM) or score statistics, and White’s information matrix (IM) test.
