FIN550 A Practical Guide to Instruments using Stata

• Topics

  The course focuses on instrumental variables (IV) based approaches to identify causal relations with implementation in Stata. Main topics will be directed acyclic graphs (DAG) representation of IV research design, relevance condition and exclusion restriction, tests of endogeneity, the 2SLS estimator and alternatives, relations with the LATE theorems (Imbens and Angrist, 1994) of heterogenous effects models and popular IV design (lotteries, randomized buckets, judge fixed effects, Bartik IV).

• Learning outcome

  After completing the course, students will be able to:

  Knowledge.

  - identify causal relations in empirical corporate finance

  Skills.

  - use Stata to implement modern technics to identify causal relations in empirical corporate finance

  - choose appropriate identification strategy

• Teaching

  The course takes place over six weeks and is taught via Zoom. Each week consists of a 30 minute pre-recorded video lecture and a 60-minute synchronous lecture. 

• Restricted access

  The course will be open to:

  PhD students at NHH

  PhD studente other Norwegian institutions

  PhD students from other higher educational institutions

• Required prerequisites

  • Successful completion of PhD-level empirical corporate finance course;
  • Stata command language and programming fundamentals (data management commands, standard estimation commands, macro, programming constructs)

• Assessment

  Students are required to deliver one individual, written homework assignment.

• Grading Scale

  Pass-fail

• Computer tools

  STATA

• Literature

  Christopher F. Baum, An Introduction to Stata Programming, Second Ed., Stata Press