# Econometric model

**econometric modelingeconometric modelseconometricGeneralmodel**

Econometric models are statistical models used in econometrics.wikipedia

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### Econometrics

**econometriceconometricianeconometric analysis**

Econometric models are statistical models used in econometrics. Then one objective of the econometrician is to obtain estimates of the parameters a and b; these estimated parameter values, when used in the model's equation, enable predictions for future values of consumption to be made contingent on the prior month's income. In econometrics, as in statistics in general, it is presupposed that the quantities being analyzed can be treated as random variables.

Applied econometrics uses theoretical econometrics and real-world data for assessing economic theories, developing econometric models, analysing economic history, and forecasting.

### Benefit financing model

* Benefit financing model

Program One, the Projection Program, is based on the methodology of empirical econometric modeling.

### Statistical model

**modelprobabilistic modelstatistical modeling**

Econometric models are statistical models used in econometrics.

### Statistics

**statisticalstatistical analysisstatistician**

An econometric model specifies the statistical relationship that is believed to hold between the various economic quantities pertaining to a particular economic phenomenon. In econometrics, as in statistics in general, it is presupposed that the quantities being analyzed can be treated as random variables.

### Economic model

**modelmodelseconomic models**

An econometric model can be derived from a deterministic economic model by allowing for uncertainty, or from an economic model which itself is stochastic.

### Stochastic

**stochasticsstochastic musicstochasticity**

An econometric model can be derived from a deterministic economic model by allowing for uncertainty, or from an economic model which itself is stochastic.

### Consumption (economics)

**consumptiondomestic consumptionspending**

A simple example of an econometric model is one that assumes that monthly spending by consumers is linearly dependent on consumers' income in the previous month.

### Dependent and independent variables

**dependent variableindependent variableexplanatory variable**

A simple example of an econometric model is one that assumes that monthly spending by consumers is linearly dependent on consumers' income in the previous month.

### Consumer spending

**consumer expenditureconsumer expendituresConsumption expenditure**

where C t is consumer spending in month t, Y t-1 is income during the previous month, and e t is an error term measuring the extent to which the model cannot fully explain consumption.

### Errors and residuals

**residualserror termresidual**

where C t is consumer spending in month t, Y t-1 is income during the previous month, and e t is an error term measuring the extent to which the model cannot fully explain consumption.

### Parameter

**parametersparametricargument**

Then one objective of the econometrician is to obtain estimates of the parameters a and b; these estimated parameter values, when used in the model's equation, enable predictions for future values of consumption to be made contingent on the prior month's income.

### Random variable

**random variablesrandom variationrandom**

In econometrics, as in statistics in general, it is presupposed that the quantities being analyzed can be treated as random variables.

### Set (mathematics)

**setsetsmathematical set**

An econometric model then is a set of joint probability distributions to which the true joint probability distribution of the variables under study is supposed to belong.

### Joint probability distribution

**joint distributionjoint probabilitymultivariate distribution**

An econometric model then is a set of joint probability distributions to which the true joint probability distribution of the variables under study is supposed to belong.

### Index set

**indexedfamilyindex**

In the case in which the elements of this set can be indexed by a finite number of real-valued parameters, the model is called a parametric model; otherwise it is a nonparametric or semiparametric model.

### Parametric model

**parametricregular parametric modelparameters**

In the case in which the elements of this set can be indexed by a finite number of real-valued parameters, the model is called a parametric model; otherwise it is a nonparametric or semiparametric model.

### Nonparametric statistics

**non-parametricnon-parametric statisticsnonparametric**

In the case in which the elements of this set can be indexed by a finite number of real-valued parameters, the model is called a parametric model; otherwise it is a nonparametric or semiparametric model.

### Semiparametric model

**semiparametricsemi-parametricsemi-parametric model**

### Model selection

**statistical model selectionselectingchoose a model**

A large part of econometrics is the study of methods for selecting models, estimating them, and carrying out inference on them.

### Estimation theory

**parameter estimationestimationestimated**

A large part of econometrics is the study of methods for selecting models, estimating them, and carrying out inference on them.

### Statistical inference

**inferential statisticsinferenceinferences**

A large part of econometrics is the study of methods for selecting models, estimating them, and carrying out inference on them.

### Structural equation modeling

**structural equation modelstructural equation modellingstructural equation modeling (SEM)**

The most common econometric models are structural, in that they convey causal and counterfactual information, and are used for policy evaluation.

### Counterfactual conditional

**counterfactualcounterfactualscounterfactual conditionals**

The most common econometric models are structural, in that they convey causal and counterfactual information, and are used for policy evaluation.

### Fiscal policy

**fiscalfiscal policiesfiscal management**

For example, an equation modeling consumption spending based on income could be used to see what consumption would be contingent on any of various hypothetical levels of income, only one of which (depending on the choice of a fiscal policy) will end up actually occurring.

### Linear regression

**regression coefficientmultiple linear regressionregression**