📚 Introductory Econometrics with MORISTAT

A Practical Guide to Empirical Analysis

Naguib Lallmahomed · naglal@linux-mauritius.com · 2026-06-14

Chapter 1: Introduction to Econometrics and MORISTAT

1.1 What is Econometrics?

Econometrics is the intersection of economics, mathematics, and statistics. It provides the tools to:

• Quantify economic relationships
• Test economic theories
• Forecast economic variables
• Evaluate policy interventions

Econometrics is the application of statistical methods to economic data for the purpose of testing economic theories and forecasting economic phenomena.

1.1.1 The Econometric Workflow

A typical econometric analysis follows these steps:

1. Economic Theory → Mathematical Model
2. Econometric Model Specification
3. Data Collection
4. Parameter Estimation using MORISTAT
5. Hypothesis Testing
6. Prediction or Policy Analysis

1.2 Getting Started with MORISTAT

1.2.1 Installing MORISTAT

MORISTAT is written in standard C and compiles on any system with a C compiler.

# Compile MORISTAT
gcc -o moristat moristat.c -lm

# Run MORISTAT
./moristat

1.2.2 Your First MORISTAT Session

Let's walk through a complete example:

MORISTAT> LOAD sales.csv
MORISTAT> SUMMARY
MORISTAT> EXIT

▶ Run this full session in MORISTAT

1.3 Understanding MORISTAT Output

When you run a regression, MORISTAT produces a comprehensive output:

============================================================
REGRESSION RESULTS
============================================================
Dependent variable: Sales
Observations: 100, Regressors: 3

Variable    Coeff   Std Err t-stat p-value
--------   ------  ------- ------ -------
Intercept  10.2345  2.1456  4.7692 0.000005 ***
Advertising 2.3456  0.4567  5.1369 0.000001 ***
Price     -1.2345  0.3456 -3.5718 0.000543 ***

R-squared: 0.8924, Adj R-squared: 0.8892
F-statistic: 412.34 (p=0.000000)

1.3.1 Interpreting the Output

1.4 The MORISTAT Command Reference

1.4.1 Data Management Commands

LOAD <filename>  # Load CSV data file
LIST              # Display current data
SUMMARY           # Summary statistics
CORR              # Correlation matrix

1.4.2 Regression Commands

REGRESS Y ~ X1 X2  # Multiple regression
VIF                # Variance Inflation Factor
CI <level>         # Confidence intervals
PREDICT            # Make predictions

1.5 Practice Lab: Sales and Advertising

# Step 1: Load the data
LOAD sales.csv

# Step 2: Examine the data
LIST
SUMMARY

# Step 3: Check diagnostics
DIAG

# Step 4: Save results
SAVE lab1_results.txt

1.6 Key Terms

Econometrics Dependent Variable Independent Variable OLS (Ordinary Least Squares) Coefficient Standard Error t-statistic p-value R-squared

1.7 Further Reading

• Wooldridge, J.M. (2020). Introductory Econometrics: A Modern Approach, Chapter 1
• Stock, J.H. & Watson, M.W. (2019). Introduction to Econometrics, Chapter 1

1.8 What's Next?