Regression is an econometric method that allows one to attemtp to see what variables drive another variable. If you don’t know about regressions, there will be future courses that cover the topic in depth. For now what you should know is this….

Regression gets something called betas on variables. What beta represents is what a 1-unit increase in the specific variable does to the dependent variable. So a .5 beta means that if we increased the variable by 1, the dependent variable would be expected to go up by .5. Another aspect of regression is significance, which follows the same methodology as statistics. .05 means there was a 5% chance this was a random event, .01 means a 1% chance and so on. We will use 5% as our cutoff point. Finally, an aspect of the regression that’s important is that when we get betas they are given to us as though we were holding everything else constant. The topic of regression could last for well over a few courses, so we will move on in this course now.