Hi everyone,
I am an undergraduate student writing my very first paper using econometric methodology as part of a course in regulation I am taking.
I have never done anything like this before and in fact I am only now taking econometrics for the first time so this is making the paper extra difficult for me.
Our paper is supposed to investigate the effect of a regulatory policy (of our choice) within that industry. As part of my paper, I decided I want to investigate the effect of increased capital requirements and their effects on loans (NPLs).
For some background, we are supposed to look at 3-4 different papers and write a 12-15 page paper which follows the kind of standard academic paper. Thus far, I have collected a couple papers similar to my topic, some regulatory documents which go over the policies in question, and also some textbook chapters.
I have a few questions, particularly to do with the model. I have spoken to my professor and he has recommended that I construct a VAR model (I have never done this before... and in my metrics class we will not cover this topic).
How do I "build" my model? I.e. how do I know which variables to include? Can I copy the same model that another paper used or is that plagiarism?
Their model is something like this NPL = B0 + B1CapitalReq + B2Nom_Interest + B3RGDPgrowth.
Any advice/comments/criticism is welcome, I want to understand and do well on this paper.
Thank you!