Introduction to Econometrics, 4th Edition

Reach every student by pairing this text with MyLab Economics

MyLab™ is the teaching and learning platform that empowers you to reach every student. By combining trusted author content with digital tools and a flexible platform, MyLab personalizes the learning experience and improves results for each student. The 4th Edition features expanded exercise sets in MyLab Economics, offering more flexibility to instructors as they build assignments. Learn more about MyLab Economics.

Teach methods through real-world questions and applications, and at a mathematical level appropriate for an introductory course.

• A modern treatment gives students enough econometric theory to understand the strengths and limitations of the tools, making the fit between theory and applications as tight as possible, while keeping the mathematics at a level that requires only algebra.
• Students learn how to use the tools of regression analysis and how to assess the validity of empirical analyses through a threefold process:

1. Immediately after introducing the main tools of regression analysis, Chapter 9 is devoted to the threats to internal and external validity of an empirical study.
2. Next, the methods for assessing empirical studies are applied to the ongoing example in the book.
3. Lastly, students get hands-on practice with robust data sets, software, and empirical exercises. Data sets and software are available through MyLab Economics or at www.pearsonhighered.com/stock_watson.

Prepare students to work with modern applications and very large data sets, including applications that predict consumer choices and work with nonstandard data (e.g., text data).

• New - A new Chapter 14 is dedicated to big data and machine learning methods. In economics, many applications focus on the “many-predictor” problem, where the number of predictors is large relative to the sample size. This chapter introduces students to methods beyond the ordinary least squares method that can help them have much lower out-of-sample prediction errors.
• New - Chapter 17 extends the many-predictor focus of Chapter 14 to time series data. Using the dynamic factor model and a 131-variable set of US quarterly macroeconomic data, students learn how to forecast future values -- an important skill to have as professionals in the field of econometrics.
• New - Regression is now introduced with a parallel treatment of prediction and causal inference, to expose students to the different demands on how data can be collected (i.e., randomized vs. controlled variables).

Keep students engaged with a full array of pedagogical material, tools, and resources

• Updated - General Interest boxes provide students with interesting insight into related topics, while also highlighting real-world studies. The 4th Edition now extends discussion of the historical origins of instrumental variables regression (Chapter 12).
• Chapter Introductions provide real-world context and a useful roadmap for each chapter to help students navigate the material.
• Key Concept boxes at regular intervals and End-of-Chapter Summaries recap key ideas, helping students study more efficiently.
• Updated - Exercise sets provide instructor flexibility in setting up assignments. Review the Concepts questions allow students to check their understanding. In addition to Exercises that provide intensive practice, Empirical Exercises allow students to apply what they have learned to answer real-world empirical questions.

Reach every student with MyLab

• Teach your course your way: Your course is unique. So whether you’d like to build your own assignments, teach multiple sections, or set prerequisites, MyLab gives you the flexibility to easily create your course to fit your needs.
• Empower each learner: Each student learns at a different pace. Personalized learning pinpoints the precise areas where each student needs practice, giving all students the support they need -- when and where they need it -- to be successful.
• Deliver trusted content: You deserve teaching materials that meet your own high standards for your course. That’s why we partner with highly respected authors to develop interactive content and course-specific resources that you can trust -- and that keep your students engaged.
• Expanded - The 4th Edition features more exercises covering more topics to allow instructors greater flexibility in assigning auto-graded exercises that provide instant, personalized feedback to students.
• Improve student results: When you teach with MyLab, student performance improves. That’s why instructors have chosen MyLab for over 15 years, touching the lives of over 50 million students.

Check out the preface for a complete list of features and what's new in this edition.