Hanoi University Faculty of Management and Tourism Vietnam's Consumer Figure Abjuration and Influencing Factors An Econometrics Announce 5/11/2012 Tutorial 2 - BA09 Lecturer: Ms. Dao Thanh Binh Tutor: Ms. Tr? n Kim Anh Collocation components: Nguy? n Th? Ha Giang ID: 0904000018 Ngo Thi Mai Huong ID: 0904000039 Le Thanh Long ID: 0904000050 Bui Th? Huong Quyen ID: 0904000072 Hoang Minh Thanh ID: 0904000082 D? Dang Ti? n ID: 0904000089 Truong Cong Tu? n ID: 0904000091 Nguy? n Thanh Tuy? n ID: 0904000092 Acknowledgement
First and highest, we would apargue to apexed our gratefulness to all those who gave us the possibility to adequate this discovery. We would apargue to transport our pure thanks to our lecturer Ms. Dao Thanh Binh, PhD, lecturer of Faculty of Management and Tourism, Hanoi University, for her upright and ardent lectures. Extraneously her estimable intellect, this discovery cannot be civil. Our deepest gratefulness so goes to our loved governor Ms. Tran Kim Anh, conquer. Her ardent instructions and stay were of eminent succor.
Without her heart-felt abettance and welcome, this Nursing Dissertation would not be able to follow to this posterity. Abstract In new years, Vietnam’s inflation has enlargementd to an frightful admonish of two-digit, ranking itself one of 5 enumerateries having the ocean inflation admonish in the globe. That Consumer Figure Abjuration (CPI) has regularly escalated is the highest deduce for such worrying posterity. Our plan, hence, is aimed at investigating and analyzing Vietnam’s CPI by cupeling the contact of forthcoming contents on CPI: USD/VND modify admonish, petrol figure, rice figure and specie yield.
Henceforth, a foreannouncement environing inflation admonish cunning from CPI and relevant contents disminority may be ardent to succor us emend plan for healthys that can amollify as a posterity of impenetrable inflation. The mold that can best illustadmonish connection betwixt the dogged capriciouss and CPI has been discovered. Basing on our discovery, it is clear that those impure capriciouss entertain a forceous wave on Consumer Figure Index. Consideration of Contents Acknowledgementii Abstractiii List of Tables and Figuresv 1. Introduction1 2. Methodology2 2. 1. Method of collecting basis and other springs2 . 2. Methods of processing the basis2 3. Basis dissection3 3. 1. Consumer Figure Index3 3. 2. Modify admonish4 3. 3. Petrol figure5 3. 4. Rice figure6 3. 5. Specie yield7 4. Mold demonstration7 4. 1. Variables and connections7 4. 2. Mold option8 5. Return exposition and supposition cupeling13 5. 1. Return administration coefficients exposition13 5. 2. Supposition cupeling13 5. 2. 1. Understanding cupel of indivisible coefficients13 5. 2. 2. Understanding cupel of aggravateall mold15 5. 2. 3. Cupel of damage inmomentous capricious16 6. Errors and coyness17 6. 1. Limitations17 6. 2.
Errors and curatives18 6. 2. 1. Multicollinearity18 6. 2. 2. Heteroskedasticity20 6. 2. 3. Autocorrelation21 7. Conclusion24 Appendixa Referencesb List of Tables and Figures Consideration 1: EView return posterity: Lin-lin mold9 Consideration 2: EView return posterity: Log-log mold10 Consideration 3: EView return posterity: Lin-log mold11 Consideration 4: EView return posterity: Log-lin mold12 Consideration 5: R2 and CV harmoniousity betwixt molds12 Consideration 6: EView return posterity: New mold16 Consideration 7: EView return posterity: P-R,MS18 Consideration 8: EView return posterity: R-P,MS19 Consideration 9: EView return posterity: MS-P,R19
Table 10: EView White Heteroskedasticity Cupel (extraneously morose stipulations)21 Consideration 11: EView return posterity: Durbin-Watson statistic22 Consideration 12: Breusch-Godfrey Serial Cornarration LM cupel: Lags 223 Figure 1: Vietnam CPI from 2000 to 20103 Figure 2: Vietnam's USD Modify admonish from 2000 to 20104 Figure 3: Vietnam's dispose-of petrol figure from 2000 to 20105 Figure 4: Vietnam's rice figure from 2000 to 20106 Figure 5: Vietnam's specie yield from 2000 to 2010 (in VND billion)7 1. Introduction Every race globewide has always confronted delay inflation and attempting to unfold inflation healthy.
Vietnam is not an exclusion. Inflation has argued to be one of the most solicitous posteritys by twain Vietnamese legislation and economists for approximately a decade as it has disposition towards ceaselessly inflating gone 2004. Inflation is an enlargement in aggravateall figures of commodities and services in an husbanding aggravate a epoch of interval. Inflation admonish during a year get probably mollify if there is a escalation in Consumer Figure Abjuration (CPI) in that year comparing to anterior year, basing on forthcoming formula: InflationYear 2=CPIYear 2-CPIYear 1CPIYear 1
Therefore, intellect the naturalness of inflation and efficiently anticipating it can controlingly rectify and invigoreprimand the husbanding in openly, persuasive calling towards emend policy, as courteous-behaved-mannered-mannered-mannered as succoring community modereprimand to figure shift in detail. Not merely is CPI a strong machine for legislation and economic experts to respect the healthy society’s raze of waste, but it so, past relevantly, forecast the inflation admonish that may entertain a extensive contact on the healthy husbanding as courteous-behaved-mannered-mannered-mannered as the community’s daily lives.
According to Globe Bank and International Monetary Funds (IMF), smoothtually, Vietnam is listed in high-inflation zone delay a acceptioning CPI. As for IMF’s basis, Vietnam’s CPI in August 2011 went up by 23. 02% compared to the identical month of 2010; CPI in December 2011 so enlargementd by 15. 68% compared to 2010. Besides, Vietnam’s husbanding has witnessed a synchronous boost in figure of commodities and petrol throughout the year, concomitantly delay decreasing purchasing strength in new years. Do these basis mark a bad place for Vietnam? We probably do not comprehend for permanent.
We, instead, can succor lay-open a past optimistic husbanding from the foreannouncement of CPI as courteous-behaved-mannered-mannered-mannered as inflation admonish of Vietnam. From such aggravatehead solitarymn basis and figures, this plan is conducted to awaken Vietnam’s CPI and contents relevant CPI, then, giving foreannouncement environing Vietnam’s inflation admonish by forming an aggravateall rebestow of abnormitys in community’s stay expense, thus relieve judging the possibility of inflation which may subsidence smooth a gigantic husbanding of Vietnam due to the solicitation of hyperinflation. 2. Methodology 2. 1. Method of collecting basis and other springs
As discussed precedent and get be examined deeper later in this Nursing Dissertation, there are some contents that enact an relevant role in deciding the raze of oat-upr figure abjuration in Vietnam. They stop of the move of modify admonish (specifically, the USD/VND modify admonish), the figure of petrol in Vietnam which is very forceous, the Vietnamese rice figure and legislational specie yield. Through the contact of econometric theories parallel delay the examirace of each one content, the mold can be formed as follow: CPI=? 1+? 2? ER+? 3? P+? 4? R+? 5? MS+?
In apapex to append the notification in-reference-to the impure contents (dogged capriciouss), a estimate of basis entertain been placid in the epoch 2000 - 2010: * The annual Vietnamese USD/VND modify admonish; * The annual Vietnamese rice figure; * The annual specie yield of Vietnamese legislation and other institutions; * The annual petrol figure of Vietnam. All the basis appended entertain been endow from uncertain springs on trusted websites, in which we can enumerebuke on the reliability and atonement of the statistics and other kindred notification. 2. 2. Methods of processing the basis The basis appended aggravatehead are right raw basis.
Therefore, in apapex to property foreannouncement environing the raze of CPI in Vietnam precisely, some processes and caution permanently call-for to be made. Highest interval, the raw basis ought to be processed through the strength of such proofal machines as Eview and Microsoft Excel. Particularly, Microsoft Excel get succor specify the diverge in the dogged capriciouss (modify admonish, rice figure, specie yield and petrol figure) as they shift throughout the years and other indispensable proof gone Eview and its econometric cautions relieve in figuring out some forceous indicators (t-statistic, R squared, commanded R squared, p-value, etc. . Aftercited having those estimates and indices, two cupels (the t-cupel and the f-test) are professionally used to property out not merely the quantity of understanding of each dogged capricious but so the aggravateall meaningfulness that all the dogged capriciouss subscribe to the determirace of CPI. From then on, it should be past helpful for us to property some forethought environing the diverge of CPI in Vietnam inveteobjurgate on the processed basis we made. 3. Basis disminority 3. 1. Consumer Figure Abjuration Figure [ 1 ]: Vietnam CPI from 2000 to 2010
First of all, the oat-upr figure abjuration (CPI) measures of the aggravateall oat-up of the commodities and services bought by a customary oat-upr. In legitimateity, it provides notification environing figure shifts in the race’s husbanding to legislation, calling, strive and not-public citizens and is used by them as a pilot to making economic decisions. Therefore, analyzing CPI is very relevant this aids in formulating fiscal and monetary policies. As can be seen from the chart, there was a regular enlargement in the CPI from 2000 to 2010. In other vocable, the customary race has to lay-out past dollars to preserve the identical exemplar of stay during 10 years.
To enumerate, aftercited undergoing a disregard enlargement in the highest impureth years from 100 to environing 110, CPI enlargementd forceously to a peak of encircling 210 in the enlargeed year. There are sundry contents including modify admonish, specie yield, rice figure and petrol figure which inducement this enlargement in CPI are nature solicitous. 3. 2. Modify admonish Figure [ 2 ]: Vietnam's USD Modify admonish from 2000 to 2010 According to the basis compiled from 2000 to 2010, the modify admonish of USD/VND practiced an upward diverge. In 2000, the USD/VND modify admonish was VND 14,170, then enlargementd by 4% and 5% in 2002 and 2003 respectively.
From 2003 to 2008, the modify admonish remained regular encircling VND 15,700 which can be deciphered by some rationales. Highest of all, Vietnam accessible bank manipulated the chaffer by selling USD and finished to adright the modify admonish illegitimate in forthcoming years (vietcombank, 2002). Moreover, due to the US economic fickleness and USD slander degrudge other currencies, VND depreciated hither than expected. In 2009, the modify admonish underwent a surge to VND17, 066 and continued increasing ceremoniousally to VND 18,620 in 2010.
Though the accessible bank implemented sundry policies to stabilize the modify admonish, it peaceful rose forceously gone sundry citizens had speculated the USD and waited until it appreciated plenteous past degrudge VND (scribd, 2010). Another deduce is the legitimate call-for in USD due to the enlargement in inbred products and labours. According to Mr Nguyen Van Binh, sin superintendent of the Accessible Bank, increasing modify admonish is an serviceable machine crafted by the accessible bank to boost ship-produce and economic lay-openment (luattaichinh, 2009). 3. . Petrol figure Figure [ 3 ]: Vietnam's dispose-of petrol figure from 2000 to 2010 According to the basis accumulated, the gasoline figure openly has an upward diverge though the 11-year epoch from 2000 to 2010 Aggravate the highest 4 years from 2000 to 2003, the figure of gasoline remained the identical or shiftd not plenteous. The 4 years of figure possession had practiced the ceremonious shift, which was a gigantic enlargement to 122. 2% in 2006 (from 5,400 to 12000 VND). From that apex of interval, the gasoline figure disregardly felt to 11,300 in 2007.
This is, smoothtually, followed by a forceous enlargement from 11,300 to 16,320 VND in 2008 and fluctuated in the protrrenewal of 2008 and 2010. In misrecord, the figure of gasoline in Vietnam is forecasted to be permanent to acception aggravate the proximate few years. 3. 4. Rice figure Figure [ 4 ]: Vietnam's rice figure from 2000 to 2010 According to the basis compiled, the rice figure has an upward diverge though the 10-year epoch from 2000 to 2010. The figure of rice sold was fairly regular aggravate the highest 3 years from 2000 to 2003 delay a disregard mollify to 100. 6%. This possession was followed by a unanticipated enlargement to 122. % in 2006. This diverge was invigorateedby the legitimateity that Vietnam became an authoritative component of Globe Occupation Organization (WTO) in 2007( BBC 2007), which rocketed Vietnam’s inflation to 12. 6% (ThuyTrang 2008). In enumeration, 2007–2008 globe help figure crises subscribed a segregate in the enlargement of globe help figure in open and rice figure in Vietnam in detail ( Compton etc. 2010, p. 20), innate to a observable mollify on Vietnamese rice figure to 215. 2% in 2008, and 251. 8% in 2010. To sum up, the Vietnamese rice shot up aggravate 2. 5 intervals from 2000 (100%) to 2010 (215. %) and this diverge is surmised to peaceful securityrain going on in proximate few years. 3. 5. Specie yield Figure [ 5 ]: Vietnam's specie yield from 2000 to 2010 (in VND billion) Starting delay approximately $ 200,000 billion in 2000, the quantity of specie in the husbanding saw a disregard mollify betwixt 2001 and 2004 but specie yield peaceful proveior than $ 500,000 pet, antecedently limit delay a forceous enlargement for the enlargeed epoch and reaching at $ 2,478,310 billion in 2010. Delay the quantity of specie in chaffer increasing by from 15% to 50% each year; Vietnamese entertain past specie to lay-out and figure raze so abnormal. 4.
Model demonstration 4. 1. Variables and connections In apapex to examine the moves of CPI in Vietnam, it is controling to evaluate the contents that stimulate the shifts in CPI. a) USD/VND modify admonish It is widely seen that Vietnam has leted from a eminent occupation arrears which instrument purport nature past than ship-produce. Therefore, if the modify admonish USD/VND enlargements, which can be deciphered as VND depreciates degrudge USD; purported products get be past rich than antecedently. Gone purported products achieve inbred products, Vietnamese oat-uprs entertain to let from reform figure of all purported products.
By that, domiciliary producers as the posterity get transfer sercrime of this force to enlargement the figure of domiciliary products to cope delay other exotic products. Tradable commodities nature half the basket of the CPI get enlargement the figure which controls to the surge in the CPI. b) Petrol figure Almost all the products quickly or inquickly call-for the use of petrol as the ocean fuel for conduct, genesis or rebestow fuel for electricity, coal, etc. If the figure of petrol enlargements, the oat-up of genesis get habit a mollify as courteous-behaved-mannered-mannered.
Hence, the producers get enlargement the figures of commodities to disburse for the enlargement in genesis oat-up which subscribes to reform CPI. c) Rice figure One of the ocean categories that are middle in the basket of commodities when sagacious CPI is help. Vietnam is a enumeratery where community oat-up rice as the ocean help in daily meals, thus the shift in rice figure get concern the CPI of Vietnam. d) Specie yield Lastly, as CPI is heavily relying on the figures of commodities and services, specie yield is so one of the contents that entertain property on CPI.
This can be deciphered by the legitimateity that the reform yield of specie there is on the chaffer, the proveior the appraise of Vietnam vogue is. As Vietnam Dong depreciates, figures of commodities and services get be reform and sin versa. As a posterity, specie yield shifts control to CPI shifts. 4. 2. Mold option From the identification of the contents relevant CPI aggravatehead, the capriciouss get be denoted as follow: CPI: Consumer Figure Abjuration ER: Modify admonish of USD/VND P:Petrol figure R: Rice figure MS:Money yield
A estimate of feasible molds are ry for the discovery, and in apapex to evaluate the fitness of each mold, we inveteobjurgate on 2 criteria: * R2: Coefficient of indulgent: The percentage of abnormity in CPI is deciphered by the mold. * CV: Coefficient of abnormity: The medium fault of the exemplification return administration not-absolute to the mean of Y. The mold delay reform R2 and proveior CV is emend. a) Lin-Lin mold CPI=? 1+? 2? ER+? 3? P+? 4? R+? 5? MS+? The estimated return posterity achieveed from EView is: Relying Variable: CPI| | | Method: Lowest Squares| | | Date: 05/07/12 Time: 22:20| | | Sample: 2000 2010| | |
Included observations: 11| | | | | | | | | | | | | Variable| Coefficient| Std. Error| t-Statistic| Prob. | | | | | | | | | | | C| 49. 84103| 25. 60055| 1. 946873| 0. 0995| ER| 0. 000830| 0. 001632| 0. 508588| 0. 6292| P| 0. 002170| 0. 000396| 5. 480252| 0. 0015| R| 0. 236729| 0. 046411| 5. 100736| 0. 0022| MS| 2. 02E-05| 5. 21E-06| 3. 885527| 0. 0081| | | | | | | | | | | R-squared| 0. 998614| Mean relying var| 137. 9727| Adjusted R-squared| 0. 997691| S. D. relying var| 39. 11026| S. E. of return| 1. 879410| Akaike info proof| 4. 402748| Sum squared resid| 21. 19309| Schwarz proof| 4. 83610| Log approvelihood| -19. 21511| Hannan-Quinn criter. | 4. 288740| F-statistic| 1081. 125| Durbin-Watson stat| 2. 490665| Prob(F-statistic)| 0. 000000| | | | | | | | | | | | | | Consideration [ 1 ]: EView return posterity: Lin-lin mold Return administration: CPI=49. 84103+0. 00083? ER+0. 00217? P+0. 236729? R+0. 00002? MS R2 = 0. 998614 CV=? Y=1. 879410137. 9727=0. 013622 b) Log-Log mold ln(CPI)=? 1+? 2? ln(ER)+? 3? ln(P)+? 4? ln(R)+? 5? ln(MS)+? The estimated return posterity achieveed from EView is: Relying Variable: LOG(CPI)| | | Method: Lowest Squares| | | Date: 05/07/12 Time: 22:22| | | Sample: 2000 2010| | |
Included observations: 11| | | | | | | | | | | | | Variable| Coefficient| Std. Error| t-Statistic| Prob. | | | | | | | | | | | C| -1. 145265| 1. 841843| -0. 621804| 0. 5569| LOG(ER)| 0. 215912| 0. 205886| 1. 048698| 0. 3347| LOG(P)| 0. 089703| 0. 048661| 1. 843424| 0. 1148| LOG(R)| 0. 413783| 0. 038424| 10. 76876| 0. 0000| LOG(MS)| 0. 081931| 0. 034964| 2. 343304| 0. 0576| | | | | | | | | | | R-squared| 0. 998138| Mean relying var| 0. 489313| Adjusted R-squared| 0. 996897| S. D. relying var| 0. 268175| S. E. of return| 0. 014939| Akaike info proof| -5. 266690| Sum squared resid| 0. 01339| Schwarz proof| -5. 085828| Log approvelihood| 33. 96679| Hannan-Quinn criter. | -5. 380698| F-statistic| 804. 0941| Durbin-Watson stat| 2. 453663| Prob(F-statistic)| 0. 000000| | | | | | | | | | | | | | Consideration [ 2 ]: EView return posterity: Log-log mold Return administration: ln? (CPI)=-1. 145265+0. 215912? lnER+0. 089703? ln? (P)+0. 413783? ln? (R)+0. 081931? ln? (MS) R2 = 0. 998138 CV=? Y=0. 0149390. 489313=0. 030531 c) Lin-Log mold CPI=? 1+? 2? ln(ER)+? 3? ln(P)+? 4? lnR+? 5? ln(MS)+? The estimated return posterity achieveed from EView is: Relying Variable: CPI| | | Method: Lowest Squares| | |
Date: 05/07/12 Time: 22:23| | | Sample: 2000 2010| | | Middle observations: 11| | | | | | | | | | | | | Variable| Coefficient| Std. Error| t-Statistic| Prob. | | | | | | | | | | | C| -1186. 909| 420. 9102| -2. 819864| 0. 0304| LOG(ER)| 85. 49691| 47. 05046| 1. 817132| 0. 1191| LOG(P)| 9. 066673| 11. 12034| 0. 815324| 0. 4460| LOG(R)| 80. 80824| 8. 780996| 9. 202627| 0. 0001| LOG(MS)| 1. 356787| 7. 990229| 0. 169806| 0. 8707| | | | | | | | | | | R-squared| 0. 995428| Mean relying var| 137. 9727| Adjusted R-squared| 0. 992380| S. D. relying var| 39. 11026| S. E. of return| 3. 414025| Akaike info proof| 5. 96616| Sum squared resid| 69. 93340| Schwarz proof| 5. 777478| Log approvelihood| -25. 78139| Hannan-Quinn criter. | 5. 482608| F-statistic| 326. 5862| Durbin-Watson stat| 2. 282666| Prob(F-statistic)| 0. 000000| | | | | | | | | | | | | | Consideration [ 3 ]: EView return posterity: Lin-log mold Return administration: CPI=-1186. 909+85. 49691? ln? (ER)+9. 066673? lnP+80. 80824? ln? (R)+1. 356787? ln? (MS) R2 = 0. 995428 CV=? Y=3. 414025137. 9727=0. 024744 d) Log-Lin mold ln(CPI)=? 1+? 2? ER+? 3? P+? 4? R+? 5? MS+? The estimated return posterity achieveed from EView is: Relying Variable: LOG(CPI)| | |
Method: Lowest Squares| | | Date: 05/07/12 Time: 22:23| | | Sample: 2000 2010| | | Middle observations: 11| | | | | | | | | | | | | Variable| Coefficient| Std. Error| t-Statistic| Prob. | | | | | | | | | | | C| 4. 288043| 0. 311641| 13. 75958| 0. 0000| ER| 7. 55E-06| 1. 99E-05| 0. 379928| 0. 7171| P| 2. 76E-05| 4. 82E-06| 5. 717411| 0. 0012| R| 0. 000539| 0. 000565| 0. 953313| 0. 3772| MS| 1. 38E-07| 6. 34E-08| 2. 184042| 0. 0717| | | | | | | | | | | R-squared| 0. 995633| Mean relying var| 0. 489313| Adjusted R-squared| 0. 992722| S. D. relying var| 0. 268175| S. E. of return| 0. 22878| Akaike info proof| -4. 414290| Sum squared resid| 0. 003141| Schwarz proof| -4. 233428| Log approvelihood| 29. 27859| Hannan-Quinn criter. | -4. 528297| F-statistic| 341. 9975| Durbin-Watson stat| 1. 798845| Prob(F-statistic)| 0. 000000| | | | | | | | | | | | | | Consideration [ 4 ]: EView return posterity: Log-lin mold Return administration: ln? (CPI)=4. 288043+0. 000075? ER+0. 000027? P+0. 000539? R+0. 000014? MS R2 = 0. 995633 CV=? Y=0. 0228780. 489313=0. 046755 To sum up, we entertain a harmoniousity of R2 and CV incompact the molds: | R2| CV| a| 0. 998614| 0. 013622| b| 0. 998138| 0. 030531| c| 0. 995428| 0. 24744| d| 0. 995633| 0. 046755| Consideration [ 5 ]: R2 and CV harmoniousity betwixt molds From the posteritys aggravatehead, the mold a) is the most divert mold to decipher the connection betwixt CPI the other contents: CPI=49. 84103+0. 00083? ER+0. 00217? P+0. 236729? R+0. 00002? MS 5. Return exposition and supposition cupeling 5. 1. Return administration coefficients exposition The chosen Lin-Lin mold and its exposition are feeling as follow: CPI=49. 84103+0. 00083? ER+0. 00217? P+0. 236729? R+0. 00002? MS ?1=49. 84103: If modify admonish, petrol figure, rice figure and specie yield harmonious 0 at the identical interval, CPI should be 49. 4103 on medium. However, this does not property plenteous economic recognition as there is no place that modify admonish, petrol figure, rice figure or specie yield could be harmonious to 0. ?2 = 0. 00083: Holding other capriciouss regular, if modify admonish enlargements by 1 part, CPI get enlargement by 0. 00083 parts on medium. ?3 = 0. 00217: Holding other capriciouss regular, if figure of petrol mollifys by 1 part, CPI get enlargement by 0. 00217 parts on medium. ?4 = 0. 236729: Holding other capriciouss regular, if rice figure goes up by 1 part, CPI get mollify by 0. 236729 parts on medium. ?5 = 0. 0002: Holding other capriciouss regular, if specie yield enlargements by 1 part, CPI get go up by 0. 00002 parts on medium. 5. 2. Supposition cupeling 5. 2. 1. Understanding cupel of indivisible coefficients a) Cupel the indivisible understanding of ? 2 * Step 1: H0: ? 2=0 Ha: ? 2? 0 * Step 2: T-statistic t-stat=? 2-? 2SE(? 2) * Step 3: Raze of understanding: ? = 5% * Step 4: Decision administration Repel H0 if t-stat;tc(? 2, n-k)=tc(0. 025, 6)=2. 447 * Step 5: T-stat appraise t=? 2-0Se(? 2)=0. 0008300. 001632=0. 508588 ; tc = 2. 447 * Step 6: Conclusion: Do not repel H0 at ? = 5%. There is not ample touchstoneimony to bar that ? is forceously divergent from 0 and indivisiblely forceous ? = 5%. b) Cupel the indivisible understanding of ? 3 * Step 1: H0: ? 3=0 Ha: ? 3? 0 * Step 2: T-statistic t-stat=? 3-? 3SE(? 3) * Step 3: Raze of understanding: ? = 5% * Step 4: Decision administration Repel H0 if t-stat;tc(? 2, n-k)=tc(0. 025, 6)=2. 447 * Step 5: T-stat appraise t=? 3-0Se(? 3)=0. 0020170. 000396=5. 480252 ; tc = 2. 447 * Step 6: Conclusion: Repel H0 at ? = 5%. There is ample touchstoneimony to bar that ? 3 is forceously divergent from 0 and indivisiblely forceous ? = 5%. c) Cupel the indivisible understanding of ? 4 * Step 1: H0: ? 4=0 Ha: ? ? 0 * Step 2: T-statistic t-stat=? 4-? 4SE(? 4) * Step 3: Raze of understanding: ? = 5% * Step 4: Decision administration Repel H0 if t-stat;tc(? 2, n-k)=tc(0. 025, 6)=2. 447 * Step 5: T-stat appraise t=? 4-0Se(? 4)=0. 2367290. 046411=5. 100736 ; tc = 2. 447 * Step 6: Conclusion: Repel H0 at ? = 5%. There is ample touchstoneimony to bar that ? 4 is forceously divergent from 0 and indivisiblely forceous ? = 5%. d) Cupel the indivisible understanding of ? 5 * Step 1: H0: ? 5=0 Ha: ? 5? 0 * Step 2: T-statistic t-stat=? 5-? 5SE(? 5) * Step 3: Raze of understanding: ? = 5% * Step 4: Decision administration Repel H0 if t-stat;tc(? , n-k)=tc(0. 025, 6)=2. 447 * Step 5: T-stat appraise t=? 5-0Se(? 5)=2. 02? 10-55. 21? 10-6=3. 885527 ; tc = 2. 447 * Step 6: Conclusion: Repel H0 at ? = 5%. There is ample touchstoneimony to bar that ? 5 is forceously divergent from 0 and indivisiblely forceous ? = 5%. 5. 2. 2. Understanding cupel of aggravateall mold * Step 1: H0: ? 2=? 3=? 4=? 5=0 Ha: ?? i? 0 * Step 2: F-statistic f-stat=R2/(k-1)(1-R2)/(n-k) * Step 3: Raze of understanding: ? = 5% * Step 4: Decision administration Repel H0 if f-stat;fc(? ,k-1,n-k)=fc(0. 05,4,6)=4. 53 * Step 5: F-stat appraise f-stat=0. 998614/(5-1)(1-0. 998614)/(11-6)=1081. 125;fc=4. 3 * Step 6: Misrecord Repel H0 at ? = 5%. There is ample touchstoneimony to bar that at lowest one coefficient is divergent from 0 and the aggravateall mold is statistically forceous. 5. 2. 3. Cupel of damage inmomentous capricious From the cupel aggravatehead, we collect the misrecord that ? 2 is unimportant. Thus, an F-cupel of damage the dogged capricious of Modify admonish from the mold get be conducted. The return posteritys achieveed from EView of the new mold is: Relying Variable: CPI| | | Method: Lowest Squares| | | Date: 05/09/12 Time: 11:07| | | Sample: 2000 2010| | | Middle observations: 11| | | | | | | | | | | | Variable| Coefficient| Std. Error| t-Statistic| Prob. | | | | | | | | | | | C| 62. 73309| 3. 386991| 18. 52178| 0. 0000| P| 0. 002123| 0. 000364| 5. 828831| 0. 0006| R| 0. 229613| 0. 041843| 5. 487545| 0. 0009| MS| 2. 22E-05| 3. 29E-06| 6. 758719| 0. 0003| | | | | | | | | | | R-squared| 0. 998555| Mean relying var| 137. 9727| Adjusted R-squared| 0. 997935| S. D. relying var| 39. 11026| S. E. of return| 1. 777106| Akaike info proof| 4. 263137| Sum squared resid| 22. 10674| Schwarz proof| 4. 407826| Log approvelihood| -19. 44725| Hannan-Quinn criter. | 4. 171931| F-statistic| 1612. 50| Durbin-Watson stat| 2. 175208| Prob(F-statistic)| 0. 000000| | | | | | | | | | | | | | Consideration [ 6 ]: EView return posterity: New mold The old mold is: CPI=49. 84103+0. 00083? ER+0. 00217? P+0. 236729? R+0. 00002? MS delay R2 = 0. 998614 The new mold is: CPI=62. 73309+0. 002123? P+0. 229613? R+0. 00002? MS delay R2 = 0. 998555 * Step 1: H0: ? 2 = 0 Ha: ? 2 ? 0 * Step 2: F-statistic F*=(R2unrestricted-R2restricted)/Number of descendped regressors(1-R2unrestricted)/(n-k) * Step 3: Raze of understanding ? = 5% * Step 4: Decision administration Repel H0 if F* ; Fc(? ,No,n-k) = Fc(0. 05,1,11-4) = 5. 59 * Step 5: F* appraise F*=(0. 98614-0. 998555)/1(1-0. 998614)/(11-4)=0. 29798 * Step 6: Misrecord F* ; Fc Do not repel H0 at ? = 5%. It is statistically deduceable to descend Modify Admonish capricious from the mold. The new mold achieveed is:CPI=62. 73309+0. 002123? P+0. 229613? R+0. 00002? MS| 6. Errors and coyness 6. 1. Limitations In grudge of the posteritys and discourse mentioned aggravatehead, our announce in open and our mold in detail entertain their coynesss that aloft our collocation to lay-open the most serviceable mold. Highest and highest, in basis dissection, we bestowed a consideration of 1 relying capricious and 4 dogged capriciouss during the epoch of 2000-2010.
In aggregate, we entertain merely placid 11 observations annually and the capriciouss casually do not entertain the harmonious observations. It is self-evident to specify that the wider the exemplification bulk the reform the chance that our exemplification statistics get bar to the penny appraise or population parameters. For such deduce, our neglect estimate observations may posterity in inatonement of the mold. Furthermore, there awaits alternate propertys incompact the dogged capriciouss. For solicitation, the Specie yield may entertain an property on the Modify admonish. Additionally, the Rice figure is so waved by the Petrol figure beinducement petrol is the ocean activity spring for genesis, etc.
Such healthys may betray our posteritys and they get be discussed excite in the minority of faults and remedies. To bar, smooth though coynesss await, the endowation of our mold is statistically unquestionable. Nevertheless, any new econometric mold simulated by us in the forthcoming get be intentional and eliminated all disclaiming coynesss. 6. 2. Errors and curatives 6. 2. 1. Multicollinearity Multicollinearity awaits due to some administrational the awaitence of straight connection incompact some or all dogged capriciouss. Multicollinearity can inducement sundry consequences.
For solicitation, OLS estimators entertain wide estrangements and covariances, making the mark delay hither atonement. This fault can control to wide estrangements and covariances, making the mark delay hither atonement. In apapex to discover the awaitence of multicollinearity, a unaffected machine of discoverion which is VIF can be applied. Beforehand, a estimate of helping returns that paint the narration ship betwixt the dogged capriciouss must be effected. Relying Variable: P| | | Method: Lowest Squares| | | Date: 05/09/12 Time: 12:23| | | Sample: 2000 2010| | | Middle observations: 11| | | | | | | | | | | | | Variable| Coefficient| Std.
Error| t-Statistic| Prob. | | | | | | | | | | | C| 2529. 790| 3163. 446| 0. 799695| 0. 4470| R| 28. 45504| 39. 34718| 0. 723179| 0. 4902| MS| 0. 003706| 0. 002908| 1. 274322| 0. 2383| | | | | | | | | | | R-squared| 0. 890213| Mean relying var| 10088. 18| Adjusted R-squared| 0. 862766| S. D. relying var| 4656. 172| S. E. of return| 1724. 882| Akaike info proof| 17. 97071| Sum squared resid| 23801730| Schwarz proof| 18. 07922| Log approvelihood| -95. 83888| Hannan-Quinn criter. | 17. 90230| F-statistic| 32. 43422| Durbin-Watson stat| 1. 144479| Prob(F-statistic)| 0. 00145| | | | | | | | | | | | | | Consideration [ 7 ]: EView return posterity: P-R,MS VIFP=11-R2P,R,MS=11-0. 890213=9. 10855;10 Relying Variable: R| | | Method: Lowest Squares| | | Date: 05/09/12 Time: 13:11| | | Sample: 2000 2010| | | Middle observations: 11| | | | | | | | | | | | | Variable| Coefficient| Std. Error| t-Statistic| Prob. | | | | | | | | | | | C| 67. 25990| 15. 92311| 4. 224043| 0. 0029| P| 0. 002156| 0. 002982| 0. 723179| 0. 4902| MS| 5. 93E-05| 1. 82E-05| 3. 250317| 0. 0117| | | | | | | | | | | R-squared| 0. 943086| Mean relying var| 144. 2364| Adjusted R-squared| 0. 928858| S. D. ependent var| 56. 29715| S. E. of return| 15. 01585| Akaike info proof| 8. 483090| Sum squared resid| 1803. 805| Schwarz proof| 8. 591607| Log approvelihood| -43. 65699| Hannan-Quinn criter. | 8. 414685| F-statistic| 66. 28185| Durbin-Watson stat| 1. 625481| Prob(F-statistic)| 0. 000010| | | | | | | | | | | | | | Consideration [ 8 ]: EView return posterity: R-P,MS VIFR=11-R2R,P,MS=11-0. 943086=17. 57047;10 Relying Variable: MS| | | Method: Lowest Squares| | | Date: 05/09/12 Time: 13:13| | | Sample: 2000 2010| | | Middle observations: 11| | | | | | | | | | | | | Variable| Coefficient| Std.
Error| t-Statistic| Prob. | | | | | | | | | | | C| -912567. 0| 169274. 2| -5. 391058| 0. 0007| P| 45. 52633| 35. 72593| 1. 274322| 0. 2383| R| 9603. 994| 2954. 787| 3. 250317| 0. 0117| | | | | | | | | | | R-squared| 0. 949597| Mean relying var| 931956. 0| Adjusted R-squared| 0. 936996| S. D. relying var| 761613. 1| S. E. of return| 191169. 4| Akaike info proof| 27. 38671| Sum squared resid| 2. 92E+11| Schwarz proof| 27. 49522| Log approvelihood| -147. 6269| Hannan-Quinn criter. | 27. 31830| F-statistic| 75. 36010| Durbin-Watson stat| 2. 509023| Prob(F-statistic)| 0. 00006| | | | | | | | | | | | | | Consideration [ 9 ]: EView return posterity: MS-P,R VIFMS=11-R2MS,P,R=11-0. 949597=19. 84009;10 From the posteritys aggravatehead, we see that VIFP ; 10 gone VIFR, VIFMS ; 10. Thus multicollinearity does not await for Petrol capricious, opportunity multicollinearity awaits for Rice and Specie Yield capriciouss. This can be deciphered by the legitimateity that Petrol figure is not waved by other contents whilst Rice and Specie Yield are waved by Petrol figure, as petrol is one of the ocean springs of activity for genesis of other commodities and services. In open, multicollinearity does await in the mold.
Nevertheless, the solitary view of our discovery is for foreannouncement and forecasting the inflation raze of Vietnam inveteobjurgate on CPI and the contents relevant CPI. Therefore, multicollinearity is not a solitarymn posterity for our discovery and we unwavering to transfer no renewal to fix the healthy. 6. 2. 2. Heteroskedasticity Heteroskedasticity propertys economic molds profane one selfreliance which is homoskedasticity of harmonious estrangement of fault stipulations. Heteroskedasticity inducements matter-of-reality lowest squares estimates of the estrangement (and, thus, exemplar faults) of the coefficients to be local, haply aggravatehead or underneath the penny or population estrangement.
As the consequence, local exemplar fault mark can control to twain mold I fault (repel the penny supposition) and mold II fault (do not repel fallacious supposition). To discover the heteroskedasticity, there are a estimate of methods that can be applied. Incompact them, we chose White's Heteroskedasticity Cupel (extraneously morose stipulations) to discover the awaitence of heteroskedasticity. * Step 1: H0: Homoskedasticity. Ha: Heteroskedasticity. * Step 2: Run the OLS on return to achieve residual ui Run the helping return to get the new mold u2=? 1+? 2X2i+… + ? qXqi+? q-1X22i+… +? 2q-1X2qi+vi H0:? 2=? 3=… = ? q W-statistic: W=n?
R2(R2 of the new mold) * Step 3: Raze of understanding ? = 5% * Step 4: Decision administration Repel H0 if W>? 2? ,df=? 20. 05,6=12. 5916 * Step 5: W-statistic appraise From the posteritys of EView, we entertain White Heteroskedasticity Test:| F-statistic| 0. 609507| Probability| 0. 720319| Obs*R-squared| 5. 253654| Probability| 0. 511716| | | | | | Cupel Equation:| Relying Variable: RESID^2| Method: Lowest Squares| Date: 05/09/12 Time: 19:52| Sample: 2000 2010| Middle observations: 11| Variable| Coefficient| Std. Error| t-Statistic| Prob. | C| -51. 06331| 66. 56641| -0. 767103| 0. 4858| P| -0. 003894| 0. 005892| -0. 60928| 0. 5448| P^2| 1. 82E-07| 3. 29E-07| 0. 552995| 0. 6097| R| 1. 041681| 1. 113821| 0. 935232| 0. 4026| R^2| -0. 003233| 0. 003599| -0. 898302| 0. 4198| MS| -1. 70E-05| 3. 45E-05| -0. 490921| 0. 6492| MS^2| 8. 86E-12| 1. 31E-11| 0. 676092| 0. 5361| R-squared| 0. 477605| Mean relying var| 2. 009703| Adjusted R-squared| -0. 305988| S. D. relying var| 3. 115326| S. E. of return| 3. 560188| Akaike info proof| 5. 638630| Sum squared resid| 50. 69977| Schwarz proof| 5. 891836| Log approvelihood| -24. 01247| F-statistic| 0. 609507| Durbin-Watson stat| 2. 651900| Prob(F-statistic)| 0. 20319| Consideration [ 10 ]: EView White Heteroskedasticity Cupel (extraneously morose stipulations) W=n? R2=5. 253654<12. 5916 * Step 6: Misrecord Do not repel H0 at ? = 5%. There is not ample touchstoneimony to argue that there awaits heteroskedasticity in the mold. 6. 2. 3. Autocornarration Autocornarration is defined as cornarration betwixt components of sequence of observations appointed in interval [as in interval sequence basis] or quantity [as in morose-sectional basis]. Incompact uncertain way to discover whether the mold has autocornarration or not, we use Durbin-Watson cupel to cupel highest apapex autocornarration and Breusch-Godfrey cupel to cupel reform apapex autocorrelation. . Durbin-Watson cupel Relying Variable: CPI| | | Method: Lowest Squares| | | Date: 05/09/12 Time: 11:07| | | Sample: 2000 2010| | | Middle observations: 11| | | | | | | | | | | | | Variable| Coefficient| Std. Error| t-Statistic| Prob. | | | | | | | | | | | C| 62. 73309| 3. 386991| 18. 52178| 0. 0000| P| 0. 002123| 0. 000364| 5. 828831| 0. 0006| R| 0. 229613| 0. 041843| 5. 487545| 0. 0009| MS| 2. 22E-05| 3. 29E-06| 6. 758719| 0. 0003| | | | | | | | | | | R-squared| 0. 998555| Mean relying var| 137. 9727| Adjusted R-squared| 0. 997935| S. D. relying var| 39. 11026| S. E. of return| 1. 77106| Akaike info proof| 4. 263137| Sum squared resid| 22. 10674| Schwarz proof| 4. 407826| Log approvelihood| -19. 44725| Hannan-Quinn criter. | 4. 171931| F-statistic| 1612. 150| Durbin-Watson stat| 2. 175208| Prob(F-statistic)| 0. 000000| | | | | | | | | | | | | | Consideration [ 11 ]: EView return posterity: Durbin-Watson statistic * Step 1: Identify Ho and Ha: Ho: ? =0. No highest apapex autocornarration Ha: ?? 0. Two-tailed cupel for highest apapex autocornarration either indispuconsideration or disclaiming one * Step 2: Cupel statistic: D - statistic * Step 3: Understanding raze: ? = 5% * Step 4: Decision administration d < dL or d > 4 - dU: Repel H0 * dU < d < 4 - dU: Do not repel H0 * dL ? d ? dU or 4 - dU ? d ? 4 - dL: Inconclusive k' = 3, df = 11. dL = 0. 595;dU = 1. 928 * Step 5: D-statistic appraise From EView consideration, we entertain D-statistic = 2. 175208 * Step 6: Misrecord We entertain 4 - dU = 4 - 1. 928 = 2. 072 4 - dL = 4 - 0. 595 = 3. 405 4 - dU ? d ? 4 - dL. There is not ample touchstoneimony to bar whether highest-apapex autocornarration awaits or not. b. Breusch-Godfrey cupel Breusch-Godfrey Serial Cornarration LM Test:| | | | | | | | | | | | F-statistic| 0. 399592| Prob. F(2,5)| 0. 6903| Obs*R-squared| 1. 515907| Prob.
Chi-Square(2)| 0. 4686| | | | | | | | | | | | | | | | Cupel Equation:| | | | Relying Variable: RESID| | | Method: Lowest Squares| | | Date: 05/09/12 Time: 14:40| | | Sample: 2000 2010| | | Middle observations: 11| | | Preexemplification missing appraise lagged residuals set to nothing. | | | | | | | | | | | Variable| Coefficient| Std. Error| t-Statistic| Prob. | | | | | | | | | | | C| 0. 366991| 3. 997023| 0. 091816| 0. 9304| P| 0. 000262| 0. 000749| 0. 349805| 0. 7407| R| -0. 020687| 0. 052521| -0. 393881| 0. 7099| MS| -1. 21E-07| 4. 84E-06| -0. 025029| 0. 9810| RESID(-1)| -0. 121687| 0. 700832| -0. 173632| 0. 8690|
RESID(-2)| -0. 759777| 1. 305304| -0. 582069| 0. 5858| | | | | | | | | | | R-squared| 0. 137810| Mean relying var| -5. 51E-15| Adjusted R-squared| -0. 724381| S. D. relying var| 1. 486833| S. E. of return| 1. 952445| Akaike info proof| 4. 478494| Sum squared resid| 19. 06021| Schwarz proof| 4. 695528| Log approvelihood| -18. 63172| Hannan-Quinn criter. | 4. 341685| F-statistic| 0. 159837| Durbin-Watson stat| 1. 950970| Prob(F-statistic)| 0. 967201| | | | | | | | | | | | | | Consideration [ 12 ]: Breusch-Godfrey Serial Cornarration LM cupel: Lags 2 * Step 1: Identify Ho and Ha:
Ho: No assist apapex autocornarration Ha: Assist apapex autocornarration * Step 2: Cupel statistic: BG - statistic = (n – p)* R2 (p = df = estimate of quantity of apapex = 2) * Step 3: Understanding raze: ? = 5% * Step 4: Decision administration: Repel H0 if BG;?? ,p2=? 0. 05,22=5. 99174 * Step 5: BG-statistic appraise From EView consideration, we entertain BG = (11-2)*R2 = 9*0. 137810 = 1. 24029 ; 5. 99174 * Step 6: Misrecord Do not repel H0 at ? = 5%. There is not ample touchstoneimony to prove the awaitence of assist-apapex autocorrelation. In enumeration, we so attend-to that the p-appraise of highest-apapex is eminenter than 0. 5, thus the highest-apapex autocornarration does not await either. To sum up, there is no autocornarration fault in the mold. 7. Misrecord Aftercited thoroughly investigating molds and their forceous, it can be provered that the best divert mold, which can courteous-behaved-mannered-mannered-mannered decipher the connection betwixt CPI and relevant contents, is the forthcoming one: CPI=49. 84103+0. 00083? ER+0. 00217? P+0. 236729? R+0. 00002? MS Basing on the dissection, the mold is argued to rather property recognition as the legitimateity that three dogged capriciouss, including petrol figure, rice figure and specie yield, distinctly concern Vietnam's CPI.
After cupeling, the USD/VND modify admonish, eventually, is distinctly unimportant. Consequently, the modify admonish is deduceably descendped out of the mold. Moreover, all dogged capriciouss entertain indispuconsideration connection delay CPI gone the enlargement of any capriciouss may posterity in enlargement of CPI. Besides the serviceableness and meaningfulness of the mold, faults and coyness peaceful await. Multicollinearity is endow out to be the considered posterity, smoothtually, it is in-truth involved to entertain any suiconsideration curative. And, two security faults including heteroscedasticity and autocornarration are shown not to await.
It is the legitimateity that the mold is necessary to some faults and coynesss, but these healthys look useless and disregard. From aggravatehead awakend basis, the dogged capriciouss bestow a spiritless diverge of increasing, which controls to disposition of CPI to mollify as courteous-behaved-mannered-mannered. Therefore, we stand that the CPI for the proximate years get boost. Degrudge Vietnamese legislation's relevant efforts to abstain the inflation admonish, it is peaceful controlingly inclined to escalate as a posterity of ineviconsideration diverge. Appendix Basis of CPI, Modify admonish, Petrol figure, Rice figure and Specie yield from 2000 to 2010
Year| CPI| Modify Rate| Petrol figure| Rice figure| Specie yield (VND billion)| 2000| 100| 14,170. 23| 5400| 100| 196,994. 00| 2001| 102| 14,816. 76| 5400| 101| 250,846. 00| 2002| 104. 3| 15,346. 00| 5400| 101. 5| 284,144. 00| 2003| 107. 6| 15,475. 99| 5600| 100. 6| 378,060. 00| 2004| 115. 9| 15,704. 13| 7000| 114. 8| 495,447. 00| 2005| 125. 5| 15,816. 69| 10000| 118. 6| 648,574. 00| 2006| 134. 9| 15,963. 81| 12000| 122. 5| 841,011. 00| 2007| 146. 3| 16,126. 20| 11300| 142| 1,254,000. 00| 2008| 179. 6| 16,303. 54| 16320| 215. 2| 1,513,540. 00| 2009| 192| 17,066. 34| 15700| 218. 6| 1,910,590. 00| 2010| 209. | 18,620. 84| 16850| 251. 8| 2,478,310. 00| References BBC, 2007. Vietnam's WTO componentship begins. Available online at URL: http://news. bbc. co. uk/2/hi/business/6249705. stm (Accessed May 4, 2012) Binh, N. V. 2009. Di? u hanh chinh sach t? gia nam 2008 va phuong hu? ng nam 2009. Available online at URL: http://luattaichinh. vocablepress. com/2009/02/26/di%E1%BB%81u-hanh-chinh-sach-t%E1%BB%B7-gia-nam-2008-va-ph%C6%B0%C6%A1ng-h%C6%B0%E1%BB%9Bng-nam-2009/ (Accessed May 4, 2012) Open Statistics Office of Vietnam, 2012. Trade, Figure and Tourism statistical basis. Available online at URL: http://www. so. gov. vn/default_en. aspx? tabid=472&idmid=3 (Accessed May 4, 2012) Gujarati, D. N. , 2003. Basic Econometrics - 4th edition. McGraw-Hill Reform Education. Indexmundi, 2011. Vietnam - specie and quasi specie. Available online at URL: http://www. abjurationmundi. com/facts/vietnam/money-and-quasi-specie (Accessed April 26, 2012) Phuoc, T. V. & Long, T. H. , 2010. Ch? s? gia tieu sordidness Vi? t Nam va cac y? u t? tac d? ng. Vietcombank, 2002. T? gia VND/USD ti? p t? c ? n d? nh tuong d? i. Available online at URL: http://www. vietcombank. com. vn/News/Vcb_News. aspx? ID=1489 (Accessed May 3, 2012)