Tuesday, August 9, 2011

Being Normal is Optional!

One of the cardinal rules of teaching is that you should never provide information that you know you're going to have to renege on in a later course. When you're teaching econometrics, I know that you can't possibly cover all of the details and nuances associated with key results when you present them at an introductory level. One of the tricks, though, is to try and present results in a way that doesn't leave the student with something that subsequently has to be "unlearned", because it's actually wrong.

If you're scratching your head, and wondering who on earth would be so silly as to teach something that has to be "unlearned", let me give you a really good example. You'll have encountered it a dozen times or more, I'm sure. You just have to pick up almost any econometrics textbook, at any level, and you'll come away with a big dose of mis-information regarding one of the standard assumptions that we make about the error term in a regression model. If this comes as news to you, then I'll have made my point!