Bootstrap, backup and basics

University-level courses in econometrics used to be an option for specialists with a solid background in mathematics and statistics. That has all changed. Econometrics is now a compulsory part of most economics degrees. In addition, the development of sophisticated computer packages and the ability to disseminate data over the web have revolutionised students' ability to undertake applied econometric work.

These two texts are an attempt to cater for the new mass market in econometrics and both make a big effort to motivate the student with case studies and computer analysis. They are clearly written and well structured.

The scope of each book is different, given differences in page length. G. S. Maddala's text covers far more ground in its extra 200 pages and is aimed at undergraduate and postgraduate students, including advanced topics such as panel data, GMM, Monte Carlo and bootstrap, as well as traditional basic econometric subjects. The book has evolved, in this third edition, into a typical American encyclopedic econometrics text.

Christopher Dougherty's text, by contrast, is aimed at a one-year UK undergraduate course and confines itself to mainstream undergraduate topics.

Both texts try to make the material accessible to all levels of undergraduate. Maddala's contains a matrix algebra development of the material, but this is confined to appendices. Dougherty goes further to simplify the mathematical content in that all estimators are defined using variance and covariance concepts and hence even the sigma notation is eliminated.

Nowadays, students demand extra support material in addition to a course book in the form of websites and lecture notes. Here Dougherty wins hands down. The associated website has lecture notes in the form of PowerPoint slideshows, which underscore the explanation of many topics with graphical methods, datasets and manuals, instructor's manuals and answers to starred questions. The website for Maddala's book contains only data sets and an instructor's manual, although it does include a number of worked examples.

Dougherty's is perhaps the more approachable of the two and has better backup, but Maddala's contains additional material that some instructors might find worth including.

Hedley Rees is senior lecturer in econometrics, University of Bristol.