ECON41515
Econometrics I
Postgraduate Programmes 2022/23
1
SUMMATIVE ASSIGNMENT – ECON41515
Econometrics I
Read and extend the work reported in Acemoglu, Johnson and Robinson (2001) with updates
in Acemoglu, Johnson and Robinson (2012). They are interested in the effect of political
institutions (measured by the variable risk) on economic performance (measured by the
variable loggdp). To investigate this question they focus on a sample of 64 former European
colonies. Their data is in the file AJR2001.
(1) Run the OLS regression of loggdp on risk, report the regression results with robust
standard errors. Discuss if the effects of political institutions on economic performance
are accurately estimated or not.
(2) Run quantile regressions of loggdp on risk at quantiles 0.2, 0.5, and 0.8. Interpret the
results and compare them to the OLS results in (1).
(3) Estimate the same model as in (1) by least squares but with two additional regressors
latitude and Africa. Report and interpret the results. Are latitude and Africa predictive
of the level of GDP? Are the effects of political institutions on economic performance
better estimated than the results in (1)?
(4) Explain why Acemoglu, Johnson and Robinson (2001) use log(mortality) as an
instrumental variable (IV) for risk. Also explain why the authors preferred
log(mortality) rather than the level of mortality as IV.
(5) Estimate the same model as in (3) using IV and report the results. Are the effects of
political institutions on economic performance better estimated than the result in (3)?
How do the estimates of the effects of latitude and africa change?
(6) Briefly summarize what robustness checks the authors have conducted in Acemoglu,
Johnson and Robinson (2001).
Reference:
[1] Acemoglu, D., Johnson, S., & Robinson, J. A. (2001). The colonial origins of comparative
development: An empirical investigation. American Economic Review, 91(5), 1369-1401.
ECON41515
Econometrics I
Postgraduate Programmes 2022/23
2
[2] Acemoglu, D., Johnson, S., & Robinson, J. A. (2012). The colonial origins of comparative
development: An empirical investigation: Reply. American Economic Review, 102(6), 3077-
3110.
Overall word limit: 1000
SUBMISSION INSTRUCTIONS
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Assignments should be typed, using 1.5 spacing and an easy-to-read 12-point font.
Assignments and dissertations/business projects must not exceed the word count
indicated in the module handbook/assessment brief.
The word count should:
▪ Include all the text, including title, preface, introduction, in-text citations, quotations,
footnotes and any other items not specifically excluded below.
▪ Exclude diagrams, tables (including tables/lists of contents and figures), equations,
executive summary/abstract, acknowledgements, declaration, bibliography/list of
references and appendices. However, it is not appropriate to use diagrams or
tables merely as a way of circumventing the word limit. If a student uses a table or
figure as a means of presenting his/her own words, then this is included in the word
count.
Examiners will stop reading once the word limit has been reached, and work beyond
this point will not be assessed. Checks of word counts will be carried out on submitted
work, including any assignments or dissertations/business projects that appear to be
clearly over-length. Checks may take place manually and/or with the aid of the word
count provided via an electronic submission. Where a student has intentionally
misrepresented their word count, the School may treat this as an offence under
ECON41515
Econometrics I
Postgraduate Programmes 2022/23
3
Section IV of the General Regulations of the University. Extreme cases may be viewed
as dishonest practice under Section IV, 5 (a) (x) of the General Regulations.
Very occasionally it may be appropriate to present, in an appendix, material which
does not properly belong in the main body of the assessment but which some students
wish to provide for the sake of completeness. Any appendices will not have a role in
the assessment - examiners are under no obligation to read appendices and they do
not form part of the word count. Material that students wish to be assessed should
always be included in the main body of the text.
MARKING GUIDELINES
Performance in the summative assessment for this module is judged against the
following criteria:
• Relevance to question(s)
• Organisation, structure and presentation
• Depth of understanding
• Analysis and discussion
• Use of sources and referencing
• Overall conclusions
The word count should include all the text (plus endnotes and footnotes), but exclude
diagrams, tables, bibliography, references and appendices. Guidance on referencing
can be found on Sharepoint; Examinations and Assessment (sharepoint.com)
PLAGIARISM AND COLLUSION
Students suspected of plagiarism, either of published work or the work of other
students, or of collusion will be dealt with according to School and University
guidelines.
Your assignment will be put through the plagiarism detection service.
END OF ASSESSMENT