Coursework Briefing 2021/22
(group, written)




Coursework information

Course Code ECON4004
Course Title Econometrics 2
Course Coordinator Sisir Ramanan
Second Internal Checker (from WLM) Dimitris Christelis
Coursework format Group Assignment
Weighting 30%
Word limit 1,200 words
Action to be taken if word limit is exceeded First 1,200 words will be marked
Submission date 21st February 2022
Date Question to be posted on Moodle 1st February 2022


Assignment Instructions


In the dataset saving.dta you will find data on you can find data on individuals (the variable pid
denotes their identification number) surveyed in the British Household Panel Survey. The survey
waves are denoted by the categorical variable wave.
In the assignment you will estimate and interpret the causal effect of being satisfied with one’s income
on whether one manages to save out of current income.
Being satisfied with one’s income is denoted by the variable satisf. This variable takes values from 1
to 7 (it should be treated as a continuous variable for the purposes of this question), with 1 denoting
not being satisfied at all, while 7 denotes being completely satisfied.
Managing to save out of current income is denoted by the binary variable sci.
The dataset also includes the continuous variable jh that denotes the hours worked in the current job,
as well as the binary variable hl, denoting being limited in daily activities due to health reasons. These
two variables should be considered as candidate instrumental variables for the variable denoting
satisfaction with income.
The following additional variables are included in the dataset: a) age (denoted by the variable age); ii)
the binary variable female denoting being a female.
1) Perform an OLS regression of sci on satisf, age, female, and dummy variables indicating the
survey wave. Discuss results from all regressors. Discuss why satisfaction with one’s income could


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have a causal effect on managing to save. Why might one be concerned that the variable denoting
being satisfied with one’s income is endogenous? (25%)
2) One potential instrument for being satisfied with one’s income is hours worked. How would one
justify the latter’s use as an instrument? Is it a plausible one? (25%)
3) Perform a two-stage least squares estimation using hours worked as an instrumental variable and
discuss the results. Discuss results from all regressors. How would you test whether the hours
worked is a good instrument? How would you test whether being satisfied with one’s income is
endogenous? (25%)
4) One potential additional instrument variable for being satisfied with one’s income could be being
limited in one’s daily activities. Discuss whether the latter is a plausible instrument. Perform a two-
stage least squares estimation using both jh and hl as instrumental variables and discuss the results.
How would you test whether being limited in one’s daily activities is a good instrument? (25%)

Information for students

• Students need to answer all four subquestions, and always discuss their work. For example, it is
not enough to show a table of regression results or statistical test results. Rather, students need
to discuss (as appropriate) what the results mean in both qualitative and quantitative terms,
what might be the problems with the estimation (if the question as for this) while providing
examples of such problems, why a particular statistical test might be needed, what is the null
hypothesis in the test, what is the interpretation of the test results.
• It is fine to copy output from the Stata results window.
• Answers need to be complete, but also concise. There is no need to write extended passages, as
the questions have a precise content.
• Students need to upload their answer file in Moodle in Adobe pdf format.
• All students are expected to participate in virtual group meetings and contribute to answering
the questions. If someone fails to attend meetings, they will be penalised.



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Feedback method

Individual feedback will normally be provided via Moodle. Generic (class-level) feedback and grade
profiles will normally be posted on Moodle.
Students can use academic staff office hours for additional feedback on your work.

Preparing your coursework

Document creation
1. Please use this file naming convention: StudentID_CourseCode_QuestionNo. e.g.
7299019_ACCFIN4029_1. If there is no question choice, use 1 as the default.
2. The file type must be .doc, .doxc, .xls, .xlsx or .pdf.
3. Include your student ID in your document, ideally in the header on each page with the
course code and title, e.g. 2489545_ACCFIN1003_Finance1.
4. The maximum file size limit on Moodle is 230MB

Formatting
You won’t be penalised if you don’t follow this good practice on formatting, but it will help your
markers.
• Use a Sans Serif font in black, e.g. Arial, Avant Garde, Calibri, Helvetica and Geneva.
• Use font size 12.
• Use 1.5 or double line spacing.
• Align your text to the left margin.
• Add page numbers.

Referencing and bibliography
You should reference your sources appropriately and list these in a bibliography. The bibliography is
excluded from your word limit. You should use the ‘Harvard’ referencing system, as detailed below
for written coursework.
In the text, use the following referencing conventions:
• Smith (1999) argues that…. or
• It has been argued that……. (Smith, 1999).
• If you use a direct quote, use quotation marks and cite the page number as well as the
author and date, i.e. (Smith, 1999, p. 4).
• If you have two items by the same author in the same year, refer to one as ‘a’ and the other
as ‘b’, i.e. Smith (1999a) and Smith (1999b).

For more information, please refer to the University Library webpage.




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Student conduct
Plagiarism
You must adhere to the University’s rules regarding plagiarism which are based on the premise
that ‘all work submitted by students for assessment is accepted on the understanding that it is the
student's own effort’. More specifically, you must avoid plagiarism in the following forms:
• Copying from sources without ‘formal and proper acknowledgement’
• Inappropriate collaboration – working with other students to produce individual coursework
or copying work produced by another student
• Submitting work which you have obtained from another source, e.g. an essay mill
• Self-plagiarism – basing coursework on work that has already been submitted for
assessment purposes.

For advice and more information, please consult:
• LEADS web pages
• University Plagiarism Statement

Turnitin
Note that your coursework will be processed through Turnitin for similarity checking. You can
submit a draft of your coursework to Turnitin before submitting your final copy. You will find
information about using Turnitin in the Student Information Point Moodle.

Submitting your coursework

You must submit in accordance with the stated time and date on page 1. See below for
information if you are unable to do so.
Finalising your document
Please follow the steps listed below:

1. Check your spelling and grammar using the inbuilt tool on your device. You will not be
penalised for grammatical and spelling errors but we recommend that you take the
opportunity to correct them.
2. Check your file name (see above).
3. Check that you have used an accepted file type (see above).
4. Do not include your name in the file name or the document to support anonymous marking.
Uploading your document to Moodle
1. You will upload your document to the designated section of the Moodle course, which will
be clearly signposted.
2. Try to upload your document at least 30 minutes before the deadline (page 1) in case you
encounter any technical issues. You will be able to resubmit the document as often as you
like until the submission deadline.
3. Complete the Declaration of Originality (see below).

Declaration of Originality
When you upload your coursework on Moodle, you will be required to select a checkbox to confirm
that you agree with the University’s Declaration of Originality which applies to all academic work, as
follows.
I confirm that this assignment is my own work and I have:
• Read and understood the guidance on plagiarism provided on the Student Information Point


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Moodle course including the University of Glasgow Statement on Plagiarism.
• Clearly referenced, in both the text and the bibliography or references, all sources used in
the work.
• Fully referenced (including page numbers) and used inverted commas for all text quoted
from books, journals, web etc.
• Provided the sources for all tables, figures, data etc. that are not my own work.
• Not made use of the work of any other student(s) past or present without
acknowledgement. This includes any of my own work, that has previously, or concurrently,
been submitted for assessment, either at this or any other institution, including school.
• Not sought or used the services of any professional agencies to produce this work.
• In addition, I understand that any false claim in respect of this work will result in disciplinary
action in accordance with University regulations.
Extensions and non-submission with good cause
Please refer to the Student Information Point Moodle for relevant information.
Late submission penalties
In the absence of good cause, late submission penalties will be applied as explained in Student
Information Point Moodle.
Questions
If you have any questions about this coursework briefing, please read it carefully again to ensure you
fully understand it. If you still have questions, please post these on the Moodle Discussion Forum.

Personal questions only can be sent to:
business-economics@glasgow.ac.uk