A Case Method for Teaching Statistics

Abstract

Knowledge of statistical methods is becoming increasingly important for economics students. Productivity and resource-usage analyses are rapidly expanding in all economic sectors. Policy research and program evaluation require statistical procedures. Improved statistical computer packages and the explosion of electronic data sets have expanded the opportunity for statistical applications to economic problems. The practice of bringing realistic applications and cases into economic education is growing in general (Siegfried et al. 1991; Schodt and Carlson 1995) and particularly in statistics classes (Becker 1996; Hilmer 1996; Carlson and Smith 1997). Reports from these authors confirm the importance of active student involvement in the learning process. Students regularly report that the case projects require considerable effort but are the most important contribution to their learning. In this article, I report on the results of using cases in a statistics course required for the economics major at a private liberal arts college. I show how students working with realistic databased cases become interested in the economic problem and, as a result, are motivated to learn statistical methods. Class sections typically have between 15 and 30 students. The course has a calculus prerequisite and is part of a major that emphasizes mathematical rigor and problem-solving applications in many courses. The statistics course topics include descriptive statistics, discrete and continuous probability, parametric probability distributions, random variables and functions of random variables, classical statistical inference, and simple and multiple regression. Classical inference and regression analysis are each allocated approximately one-third of the course time with the other topics in the remaining one-third. The textbook (Carlson and Thorne 1997) presents the mathematical content of the statistical procedures and emphasizes teaching by using realistic examples. In course lectures, I emphasize rigorous understanding of the statistical procedures and their application to economic problems. Applications require extensive use of the Minitab statistical package. Cases are used extensively because the economics students who take this course are primarily interested in the study of economics and not mathematical statistics. Students are presented with a situation that requires statistical and economic analysis to solve a realistic problem. In the cases, students must first apply economic analysis to identify the key issues and to formulate the analysis. Data from real applications are provided with the cases, and students prepare their statistical computations using the Minitab statistical package. Student teams prepare a written report, addressed to a policy decisionmaker. This report reinforces