The third edition builds on the philosophy that applications should drive the theory, not the other way around, while maintaining a focus on currency. Ensure students grasp the relevance of econometrics with Introduction to Econometrics the text that connects modern theory and practice with engaging applications.
Provide Context: Real-World Questions and Data. Each important econometric method is built around an important real world question that demands a specific numerical example. For example, the single variable regression, multiple regression, and functional form analysis are motivated by the question: Do smaller elementary class sizes produce higher test scores?
Present Consistency: Theory That Matches Application. Although econometric tools are best motivated by empirical applications, students need to learn enough econometric theory to understand the strengths and limitations of those tools. A modern treatment is provided to fit between theory and applications as tightly as possible, while keeping the mathematics at a level that requires only algebra.
Create Skilled Producers, Sophisticated Consumers. One of the goals of this textbook is to help students become sophisticated consumers of empirical analysis. To do so, they must learn how to use the tools of regression analysis and how to assess the validity of empirical analyses presented to them.