ABSTRACT
Quantitative approaches to analyzing economic data provide meaningful and useful insight for understanding how variables interact and how they might be expected to behave in a variety of circumstances, including the future. This chapter outlines the traditional econometric-based method and the relatively simple, but often more elegant, time series method for analyzing economic data in the time domain. The stochastic nature of economic data is discussed and the now common ARIMA model found in much of the empirical macroeconomic literature is developed in parts. The chapter provides a solid background for understanding “macroeconometrics” and time series analysis.
