What Is Structural Econometrics?

Econometrics is an economics based on certain economic theories and statistics, using mathematics, statistical methods, and computer technology to establish econometric models as the main means to quantitatively analyze and study the relationship between economic variables with random characteristics. Subject. The main content includes theoretical econometrics and applied econometrics. Theoretical econometrics mainly studies how to use, reform, and develop mathematical statistics methods, making it a special method for measuring economic relations. The application of econometrics is guided by certain economic theories and based on statistical data reflecting the facts, the use of econometric methods to study the practicality of economic mathematical models or explore empirical economic laws.

Model type: Stochastic model is used. Model-oriented: Establish a model guided by economic theory. Model structure: The relationship between variables is linear or can be reduced to linear. It belongs to a causal analysis model. The explanatory variables have the same status. The model has a clear form and parameters. Data type: Take time series data or cross-section data as samples, and the explanatory variables are continuous random variables that obey normal distribution. Estimation method: Only the sample information is used, and the least square method or the maximum likelihood method is used to estimate the variables. Non-classical econometrics generally refers to econometric theories, methods, and application models developed after the 1970s, also known as

Developments abroad. Econometrics was first used primarily

Two major research objects of econometrics: Cross-sectional Data and

Compared with general mathematical methods,

Econometrics is gaining popularity

Since the establishment of the Nobel Prize, the Nobel Prize in Economics has been the world's most noticeable large-scale economics award. Therefore, to this day, the Nobel Prize can still be said to be the greatest motivation and goal of many economists. The 1st Nobel Prize in Economics was awarded to "the founder of econometrics"-Friech, and the Dutch "builder of econometric model"-Ding Bergen. Over the years, many econometricians have also won the Nobel Prize in Economics with the highest honor. In recent years, the Nobel Prize has again tended to confer outstanding scholars in the branches of econometrics, encouraging their outstanding contributions to cross-section data methods. These successive awards show that the econometrics is increasingly favored by the Nobel Prize. The award is also continuously focusing on the application of economic and technological directions and continuous innovation to modernization. The development of this economic discipline has been increasingly recognized worldwide. widely accepted.

The discipline is more applied in the financial field of countries around the world

At present, many econometric models and methods have been applied to the basic disciplines of central banks and financial markets in the world, especially in the assessment of investment portfolios of some financially developed countries. They have a very strong financial system risk direction. High value and practical significance. Many econometricians and financial scientists have gradually applied econometric models to explain many laws of financial market activities. In the financial market, economic variables have certain variability. These variables will fluctuate with time, and some practical economic meanings will appear randomly. It is most commonly applied to global stock markets to explain many methods and laws. For example, assuming that people's valuation of stock prices is more rational, it can be concluded that the price of a company's stock should be equal to the present value of its expected dividend at some time in the future. Another example is the econometric ARCH model invented by Engel. This model can very effectively estimate the changes in financial laws of financial economic data at different times. This model can be used to explain the risks and prices of financial investment and other returns through the measurement of uncertainty, using certain economic models and economic data, and can be further analyzed. All this shows that econometrics is increasingly applied in the financial field of various countries.

Modern econometrics tends to combine mathematics, statistics, and economics more closely. In recent years, as panel data in econometrics has become more abundant, economists have gradually used economics such as mathematics to integrate economics with economics. The subject's theoretical knowledge system is transformed into certain equations and systems to perform more vividly, and finally estimated by statistical methods such as mathematics. This combination of methods and process changes has also promoted China's calculation of GDP, as well as the laws and changes of many economic data such as benchmark prices, interest rates, and stock prices in various industries. Therefore, the new development trend is often to adopt a combination of economics, mathematics, and statistics, so that modern econometrics tends to combine mathematics, statistics, and economics more closely ^[1] .