An individual econometric project will count for 40% of the final mark for this module. Your econometric work is to be carried out using SPSS.

BACKGROUND

Conduct an empirical investigation of an area of your choice using data from the Understanding Society survey (wave 6). The only restriction is that you are not allowed to do a project that involves using wage or income as the dependent variable. That is you are not allowed to investigate the determinants of wages, pay or income. Anyone that
does will have their mark for the project capped at 40%.

UNDERSTANDING SOCIETY SURVEY

Understanding Society is a longitudinal survey (i.e. re-interviewing the same individuals / households over time). The survey builds on and extends an earlier survey that was known as the British Household Panel Survey (BHPS). The project will involve using a single cross-section (wave 6) of the data.
Understanding Society survey provides information on household composition, employment and skills, income and wealth, education, health and lifestyle, social and political attitudes, well-being, environment and transport, children and families. Given its coverage Understanding Society and its predecessor, the BHPS, have been and continue to be used in a wide range of applications, see for example:

For the project you will be using a condensed version of the dataset. The dataset will be available to download from Blackboard but you must register with the Data Archive Service before accessing the dataset. Details on how to do this will be provided in the lecture.

SUGGESTED OUTLINE OF THE PROJECT

• Introduction
  State clearly the research question you are investigating. Indicate how you approach the problem (outline the structure of your answer). Stress any original contribution you can make.
• Background
  Briefly describe the underlying theory and findings of important related literature. If possible, critique the literature, identifying deficiencies your project addresses.
• Model
  You must centre your project on one or a number of quantitative relationships / propositions suitable for statistical estimation and/or testing. This should be related to relevant theory (where appropriate).
• Data
  Carefully define your variables; include a list of expected signs and a table of descriptive statistics. Some preliminary charts and diagrams should also be considered.
• Empirical Analysis
  The analysis of the results is the most important stage of the study. It involves estimating

an initial model or models, performing appropriate diagnostic tests, reformulating and re-estimating, conducting tests of hypothesis and, finally, prediction and policy implications.

You should consider including a comparative table of results (in terms of different estimation methods, different samples and / or variables) – basically whatever you think is appropriate given the research question you are considering. Make sure the results are interpreted appropriately in terms of sign, significance and magnitude.

• Conclusion
  Summarise your findings and discuss their implications (e.g. are there any policy implications associated with your results?). Discuss the limitations of what you have done.
• Bibliography
  Properly cite your references. This should conform to the Harvard System.
• Presentation
  Please give consideration to the readability of your project e.g. the formatting of tables, figures, equations and any regression output included. I would expect you to include the main figures/tables/equations etc. within the main body of the project. Additional figures and tables can be included in an appendix (which will not count towards the word count) but remember your marker will not necessarily look at the material in the appendix, so use it wisely!