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Statistics vs Econometrics: Key Differences To Know In 2022

Statistics vs Econometrics: Key Differences To Know In 2022

Do you enjoy working with figures or numbers? Have you ever considered economic solutions? Or do you simply like solving complicated statistical problems? If your answer to any of these questions is yes, you must know statistics and econometrics. Today, we will highlight the points of statistics vs econometrics. These will help you to distinguish these two topics. So, let’s check the details in the upcoming sections.

What do you mean by statistics?

Statistics is primarily a branch of practical math. It also collects and analyses numerical information to calculate proportions from a representative sample. (For example, what proportion of a class of 100 students wishes to study statistics.)

Also, the United States is obsessed with numbers. That is why investigating anything, including the fact that Covid-19. Or the possibility of a NASA rocket blowing up can be some of the interesting statistics topics.

What do you mean by econometrics?

You will learn to use statistical methodologies, math concepts, and computer science in econometrics. It also teaches you how to evaluate data.

Econometrics may use to predict the amount of money that a marketing effort will create. For example: How much more sales will you get if you invest an extra dollar on a campaign? This may also be calculated using econometrics software.

Econometrics is divided into three categories. Math, statistics, and economic theory are among them. But it is not the same as math, economic statistics, or broad economic theory. Instead, it contains all of them. These are to help analysts in understanding current economic quantitative relationships.

Alternatives and salary pay difference between statistics vs econometrics

Your work as a statistician will be to analyze, interpret, and present data. Moreover, the good news is that you can work in virtually any industry:

  • government 
  • forensics 
  • health education 
  • forensics
  • market research
  • finance government 

The average annual pay is $68,000 USD when you first enter the workforce.

You can also select from a range of alternatives as an econometrics graduate:

  • financial adviser
  • risk management consultant
  • financial controller

You can also join logistics and infrastructure teams. This is for creating mathematical models and forecasts for bridges, and other structures. In general, you may work somewhere that requires applied economics and statistics. 

The average annual salary starts at $72,000 USD.

A list of things can perform by econometrics and statistician

To distinguish statistics vs econometrics, it is necessary to know their job role. There are certain things that one can perform but can not. Let’s what they exactly are:

Econometricians:

  1. develop an economic theory that can be empirically tested.
  2. also use mathematical and statistical methods to create models.
  3. concentrate on historical research.

We may conclude that an econometrician is a statistician. He/she has a background in economics and works with economic models. What are the options for statisticians who aren’t econometricians?

Statisticians:

  1. are concerned with data collecting as well as presentation.
  2. concentrate on identifying patterns in the data.
  3. would like to know what variables will be like in the future based on their current situations.

Now, check what exactly the difference between statistics vs econometrics

The core topics of study that differentiate statistics and econometrics are different. The field of statistics mostly concerne with applied math. But econometrics is a branch of economics. Furthermore, statistics encompasses a wide field of research. While statistics include in econometrics, it is not as wide.

To function, econometrics depends on statistics and statistical models. It does not, however, limit itself to them. It also includes mathematics and economic theory, which are both essential components. The statistics utilise in econometrics are limited to a certain subject of study. Furthermore, econometrics encompasses additional topics like causal inference and time series analysis. 

ML and statistical software packages are redefining the future of econometrics and statistics. Whereas traditional modeling emphasizes hypothesis testing of causes. Also, the ML paradigm emphasizes prediction accuracy even when models are unintelligible. Cross-validation of prediction accuracy is useful to choose a model.

Let’s wrap it up!

 

Today we have discussed the key points about statistics vs econometrics. Some people may be confused by the overlaps between both terms. But both of these professions deal with statistics and data relationships. But they are not the same.

Econometrics is an economics topic that relies heavily on statistics and statistical models. It is, however, distinct from statistics. Other disciplines, like math and economic theory, are included in econometrics. But statistics is science. It employs the use of gathering, examining, interpreting, and drawing conclusions. That are from numerical data.

Hope this blog helps you to understand the details of statistics and econometrics. Now, you can easily differentiate statistics vs econometrics. If you have any suggestions, please provide us with your emails. We always appreciate the suggestions given by our readers.

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