How to explain the omitted variable bias

In regression analysis, the omitted-variable-bias is the error that is incurred on partial-effects-coefficients of other explanatory variables in a restricted regression model. Two factors play a role in the quantification of the omitted-variable-bias: Partial effects of the omitted-variable on the explained variable. Correlation and Covariance of omitted variable with the rest of the explanatory variablesContinue reading “How to explain the omitted variable bias”

The Technique of Scientific Writing in Economics

Since I started training individual students from several economic faculties in German Universities about the technique of scientific writing, they asked me where they could find some inspiration to get an appropriate topic for their Bachelor and Master thesis. Depending on the regulations of your university, the supervising professor or lecturer may suggest a specificContinue reading “The Technique of Scientific Writing in Economics”

Our Credentials for Economic Consultancy

Economics was my third-best option career after Aeronautical Engineering and Architecture respectively, but now I understand the reason why we need to share knowledge across disciplines.

The Economic Concept of Opportunity Costs

The economic concept of opportunity costs is the most fundamental issue of economics as a social science that explains the decision-making and behavior of economic subjects. Economics subjects are private households, firms and the government as a public household. While explaining opportunity cost, focus on the question: why do people choose to do, consume orContinue reading “The Economic Concept of Opportunity Costs”

What is economics?

Economics is a social and behavioral science that explains the human nature of making both rational and irrational decisions. Deviations from the optimal decisions defined by the decision rules are deemed to be irrational behavior, while abiding by the decision rules the behavior is deemed to be rational behavior at the individual level and inContinue reading “What is economics?”