The practice of teaching economics is subject to an ongoing process of evolution. In the two related areas of computing and quantitative analysis, the rate of change approximates more to a revolution. Two new textbooks that keep pace with these changes are Analysis of Economic Data by Gary Koop and Computing Skills for Economists by Guy Judge.
In his textbook, Koop assumes little mathematical background and takes the reader through most of the tools and models used in modern econometric research.
The striking and highly commendable feature of the text is the intuitive approach. It is a rare textbook that can be read cover to cover sustaining the reader's interest - let alone an econometrics textbook. The text is aimed at students whose primary interest is not in econometrics, and with the proliferation of undergraduate and graduate programmes requiring these skills, it is timely.
Loosely speaking, the text divides into two. First, a rapid introduction to multiple regression, and second, a surprisingly thorough coverage of time-series econometrics, including cointegration, macroeconometrics and finance. Some of this latter material might feasibly have been sacrificed in favour of the former. In particular, the issues of heteroscedasticity and serial correlation are relegated to the final chapter on limitations and extensions. However, this is a minor quibble next to its major strength, its accessibility to non-experts.
There are also no prerequisites needed to approach Judge's textbook. In this text, some of the various uses economists can put computers to are described. There is an emphasis on the internet, and appropriately Judge (as indeed does Koop) provides data sets and other resources on the web.
A patient introduction to all the basic computing aspects is provided, and the reader is invited to perform a series of sensible practicals that can be undertaken independently. There is an excellent chapter on the use of spreadsheets, in particular Excel, which is thoroughly up to date and enlightens the reader to the increasing array of applied economics that can be undertaken using this basic tool.
Difficult choices had to be made in the chapter on specialist econometrics software, because of the number and diversity of such packages. Judge specialises in TSP and PCGive, but there are many useful general observations that apply to other packages.
Conceivably, both texts could be improved with greater mutual links, for example by recourse to the same examples. However, both successfully stand alone and are valuable additions to the literature.
Andrew Pickering is research assistant in economics, University of Exeter.
Analysis of Economic Data. First Edition
Author - Gary Koop
ISBN - 0 471 9991 5
Publisher - Wiley
Price - £18.99
Pages - 219