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$ Retail Sales $. Economics 240A Team Member: Yi-Ling LiuLuke Panzar Salam EnglerEdgar Torres Allyson Cady. Background. What. Background. What Effects on Retail Sales from Personal Income, Consumer Confidence, Interest Rate, and others. - PowerPoint PPT Presentation
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$ Retail Sales $
Economics 240A
Team Member:
Yi-Ling Liu Luke Panzar
Salam Engler Edgar Torres
Allyson Cady
Background What
Background What
– Effects on Retail Sales from Personal Income, Consumer Confidence, Interest Rate, and others
Background What
– Effects on Retail Sales from Personal Income, Consumer Confidence, Interest Rate, and others
Why
Background What
– Effects on Retail Sales from Personal Income, Consumer Confidence, Interest Rate, and others
Why– Understand some variables that affect Retail Sales
Background What
– Effects on Retail Sales from Personal Income, Consumer Confidence, Interest Rate, and others
Why– Understand some variables that affect Retail
Sales How
Background What
– Effects on Retail Sales from Personal Income, Consumer Confidence, Interest Rate, and others
Why– Understand some variables that affect Retail
Sales How
– Statistical Methods (i.e. Least Mean Squares, Regression)
Approach
Long Term Affected by:
Approach
Long Term Affected by:– Personal Income
Data Analysis
Personal Disposable vs. Retail Sales Long Term
11.0
11.5
12.0
12.5
13.0
13.5
13.0 13.5 14.0 14.5 15.0 15.5 16.0
LOG(NOMDISPINCM)
LOG
(RE
TAIL
SA
LES
M)
Dependent Variable: LOG(RETAILSALESM) Method: Least Squares Date: 11/26/02 Time: 11:35 Sample: 1968:3 1997:2 Included observations: 116
Variable Coefficient Std. Error t-Statistic Prob.
C -0.573955 0.045557 -12.59858 0.0000 LOG(NOMDISPINCM) 0.893151 0.003121 286.2066 0.0000
R-squared 0.998610 Mean dependent var 12.45025 Adjusted R-squared 0.998598 S.D. dependent var 0.618620 S.E. of regression 0.023163 Akaike info criterion -4.675447 Sum squared resid 0.061163 Schwarz criterion -4.627971 Log likelihood 273.1759 F-statistic 81914.19 Durbin-Watson stat 0.325630 Prob(F-statistic) 0.000000
Probably Affecting Variables
Short Term:
Probably Affecting Variables
Short Term:– Personal Income
Probably Affecting Variables
Short Term:– Personal Income– Consumer Confidence
Probably Affecting Variables
Short Term:– Personal Income– Consumer Confidence– Interest Rate
Probably Affecting Variables
Short Term:– Personal Income– Consumer Confidence– Interest Rate– S & P Composite
Probably Affecting Variables
Short Term:– Personal Income– Consumer Confidence– Interest Rate– S & P Composite– Unemployment Rate
Data Analysis
Personal Disposable vs. Retail Sales Short Term
Dependent Variable: D(RETAILSALESM) Method: Least Squares Date: 11/26/02 Time: 10:52 Sample(adjusted): 1968:4 1997:2 Included observations: 115 after adjusting endpoints
Variable Coefficient Std. Error t-Statistic Prob.
C 2124.211 629.0292 3.376966 0.0010 D(NOMDISPINCM) 0.060040 0.011549 5.198840 0.0000
R-squared 0.193018 Mean dependent var 4823.609 Adjusted R-squared 0.185877 S.D. dependent var 4220.093 S.E. of regression 3807.739 Akaike info criterion 19.34470 Sum squared resid 1.64E+09 Schwarz criterion 19.39243 Log likelihood -1110.320 F-statistic 27.02794 Durbin-Watson stat 2.237195 Prob(F-statistic) 0.000001
Data Analysis
Lagging Personal Disposable Income (Short Term)
Dependent Variable: D(RETAILSALESM) Method: Least Squares Date: 11/26/02 Time: 10:56 Sample(adjusted): 1969:1 1997:2 Included observations: 114 after adjusting endpoints
Variable Coefficient
Std. Error t-Statistic Prob.
C 1427.638 804.9848 1.773497 0.0789 D(NOMDISPINCM) 0.059064 0.011637 5.075566 0.0000
D(NOMDISPINCM(-1)) 0.016709 0.011696 1.428538 0.1559
R-squared 0.204975 Mean dependent var 4846.439 Adjusted R-squared 0.190650 S.D. dependent var 4231.586 S.E. of regression 3806.899 Akaike info criterion 19.35298 Sum squared resid 1.61E+09 Schwarz criterion 19.42499 Log likelihood -1100.120 F-statistic 14.30911 Durbin-Watson stat 2.240408 Prob(F-statistic) 0.000003
Data Analysis
Personal Disposable Income, Consumer Confidence, vs.Retail Sales Short Term
Dependent Variable: D(RETAILSALESM) Method: Least Squares Date: 11/26/02 Time: 10:58 Sample(adjusted): 1969:4 1997:2 Included observations: 111 after adjusting endpoints
Variable Coefficient Std. Error t-Statistic Prob.
C 2578.415 637.6329 4.043730 0.0001 D(NOMDISPINCM) 0.051579 0.011540 4.469405 0.0000
D(CONSCONF) 131.9376 36.05752 3.659088 0.0004
R-squared 0.269180 Mean dependent var 4940.847 Adjusted R-squared 0.255646 S.D. dependent var 4246.733 S.E. of regression 3663.908 Akaike info criterion 19.27710 Sum squared resid 1.45E+09 Schwarz criterion 19.35033 Log likelihood -1066.879 F-statistic 19.88961 Durbin-Watson stat 2.489156 Prob(F-statistic) 0.000000
Data Analysis
Addition of Real Prime Rate
Dependent Variable: D(RETAILSALESM) Method: Least Squares Date: 11/26/02 Time: 11:01 Sample(adjusted): 1969:4 1997:2 Included observations: 111 after adjusting endpoints
Variable Coefficient Std. Error t-Statistic Prob.
C 2523.225 641.1886 3.935231 0.0001 D(NOMDISPINCM) 0.052878 0.011642 4.542087 0.0000
D(CONSCONF) 134.8747 36.23942 3.721767 0.0003 D(REALPRIME) -320.1755 357.5827 -0.895389 0.3726
R-squared 0.274615 Mean dependent var 4940.847 Adjusted R-squared 0.254277 S.D. dependent var 4246.733 S.E. of regression 3667.276 Akaike info criterion 19.28766 Sum squared resid 1.44E+09 Schwarz criterion 19.38530 Log likelihood -1066.465 F-statistic 13.50264 Durbin-Watson stat 2.475944 Prob(F-statistic) 0.000000
Data Analysis
Addition of S & P Composite
Dependent Variable: D(RETAILSALESM) Method: Least Squares Date: 11/26/02 Time: 11:06 Sample(adjusted): 1969:4 1997:2 Included observations: 111 after adjusting endpoints
Variable Coefficient Std. Error t-Statistic Prob.
C 2564.992 622.1614 4.122711 0.0001 D(NOMDISPINCM) 0.051893 0.011261 4.608343 0.0000
D(CONSCONF) 111.7882 36.06535 3.099600 0.0025 D(SPCOMRETURN) -82.47764 32.48482 -2.538960 0.0126
R-squared 0.310707 Mean dependent var 4940.847 Adjusted R-squared 0.291381 S.D. dependent var 4246.733 S.E. of regression 3574.878 Akaike info criterion 19.23662 Sum squared resid 1.37E+09 Schwarz criterion 19.33426 Log likelihood -1063.632 F-statistic 16.07719 Durbin-Watson stat 2.442283 Prob(F-statistic) 0.000000
Data Analysis
Addition of Unemployment Rate
Dependent Variable: D(RETAILSALESM) Method: Least Squares Date: 11/26/02 Time: 11:23 Sample(adjusted): 1969:4 1997:2 Included observations: 111 after adjusting endpoints
Variable Coefficient Std. Error t-Statistic Prob.
C 2888.602 635.7229 4.543807 0.0000 D(NOMDISPINCM) 0.045682 0.011529 3.962299 0.0001
D(CONSCONF) 91.20960 38.91831 2.343617 0.0209 D(UNRATEE) -2589.095 1050.130 -2.465500 0.0153
R-squared 0.308466 Mean dependent var 4940.847 Adjusted R-squared 0.289077 S.D. dependent var 4246.733 S.E. of regression 3580.685 Akaike info criterion 19.23987 Sum squared resid 1.37E+09 Schwarz criterion 19.33751 Log likelihood -1063.813 F-statistic 15.90951 Durbin-Watson stat 2.520505 Prob(F-statistic) 0.000000
Data Analysis
Final Combination of Affecting Variables Short Run
Dependent Variable: D(RETAILSALESM) Method: Least Squares Date: 11/26/02 Time: 11:29 Sample(adjusted): 1969:4 1997:2 Included observations: 111 after adjusting endpoints
Variable Coefficient Std. Error t-Statistic Prob.
C 2785.722 620.5644 4.489014 0.0000 D(NOMDISPINCM) 0.048133 0.011275 4.269030 0.0000
D(CONSCONF) 77.59166 38.31645 2.025022 0.0454 D(UNRATEE) -2646.374 1062.354 -2.491047 0.0143
D(SPCOMRETURN) -73.35842 32.04261 -2.289402 0.0241 D(REALPRIME) -567.3832 349.9570 -1.621294 0.1080
R-squared 0.355903 Mean dependent var 4940.847 Adjusted R-squared 0.325231 S.D. dependent var 4246.733 S.E. of regression 3488.449 Akaike info criterion 19.20484 Sum squared resid 1.28E+09 Schwarz criterion 19.35130 Log likelihood -1059.869 F-statistic 11.60376 Durbin-Watson stat 2.468609 Prob(F-statistic) 0.000000
Summary
What Affects Retail Sales over the Long Run?
Summary
What Affects Retail Sales over the Long Run?– Personal Disposable Income
Summary
What Affects Retail Sales over the Short Run?
Summary
What Affects Retail Sales over the Short Run?– Personal Disposable Income– Consumer Confidence– Real Prime Rate– S & P Composite– Unemployment Rate
The End
Thank you Gracias (pronounced Shie Shie) Merci Danke Domo Ari Gato
Appendix
CONSUMERNOMINAL NOMINAL PERSONAL CONSUMER PRIME DISCOUNT PRICE S&P UNEMPLOYMENT
YEAR:QUARTER RETAIL SALES DISPOSABLE INCOME CONFIDENCE RATE RATE INDEX COMPOSITE RATE1955:01:00 NA NA NA NA NA NA NA NA 1955:02:00 NA NA NA 3 NA 26.7 NA 4.71955:03:00 NA NA NA 3 NA 26.7 NA 4.41955:04:00 NA NA NA 3.17 NA 26.8 NA 4.1
1995:01:00 572022 5193100 97.6 8.169999 4.75 149.6 459.27 5.61995:02:00 573137 5286600 100.3 8.83 5.25 150.9 500.71 5.51995:03:00 578680 5319700 100.4 9 5.25 152.2 544.75 5.61995:04:00 585146 5380200 100.4 8.799999 5.25 152.9 584.41 5.71996:01:00 589573 5436200 99 8.77 5.25 153.6 615.93 5.61996:02:00 600694 5519400 94.89999 8.33 5 155 645.5 5.61996:03:00 609045 5573500 102.8 8.25 5 156.5 670.6299 5.41996:04:00 610773 5644600 110.3 8.25 5 157.4 687.33 5.31997:01:00 618960 5695800 110.3 8.25 5 158.5 740.74 5.31997:02:00 635597 5790500 118.7 8.27 5 159.6 757.12 5.3
Some Data
