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Ooh…Pretty Colors… December 3, 2006

Posted by Brian L. Belen in Academically Speaking, Show and Tell.
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A three dimensional scatterplot of a regression line. The yellow spheres are the observed data.

For those in the real world who don’t speak economics or statistics (i.e. normal people), a regression line depicts the effect that changes in independent explanatory variables have on a dependent variable. This particular regression line is a production function: the rate of change of output (lQ) is the vertical axis, while the rates of change of capital and labor (lK and lL, respectively) are what cause output to change. Obviously, a three-dimensional plot is only possible when there are at most three variables in a model (two independent, one dependent).

As the title of this post suggests, this plot isn’t necessarily anything meaningful. Economics is funnier that way.

The plot was made using R, open source econometrics software at its best.

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Comments»

1. Jason dV - December 3, 2006

Ugh. Reminds me why I took up communication instead of math or economics 😉

2. Brian L. Belen - December 4, 2006

But, but, but…it’s soooo preeeeetty! =p

3. barookie - December 4, 2006

hahaha! I must agree with you Brian, it really is a nice pretty graph!

Would have been nicer to see a saddle path as well.

Btw, hope you don’t mind if I link your blog to mine.

4. Brian L. Belen - December 4, 2006

Be my guest. I’m a sucker for anything that might push my readership into double digits!

5. Jason dV - December 5, 2006

Pretty painful to understand, if you ask me, haha!

6. Vincent - December 7, 2006

I agree with Jason. The graph makes my mind wonder off to better things.


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