HT 2026 · Department of Economics

Applied Machine Learning & AI for Economics

Bridging econometrics and data science — theory, Python, and real-world applications.

Elodie Chervin
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Daniel Barbosa

About the Course

This course bridges the gap between traditional econometrics and modern data science, offering both a theoretical understanding of machine learning and the practical skills to apply it. We examine how techniques like supervised and unsupervised learning, natural language processing, and the emerging field of Causal ML allow economists to tackle large, complex datasets. We also explore the transformative role of AI and Large Language Models in social science research.

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Level
3rd-year Economics undergraduates
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Duration
8 weeks · 2-hour lectures
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Language
Python (no prior experience required)
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Assessment
Assignment (70%) + Presentation (30%)

Prerequisites

Students should have completed a course in econometrics or statistics covering multivariate regression and hypothesis testing. No prior programming experience is required, but willingness to invest time and effort in learning the basics of Python in and outside of class is expected.

Weekly Schedule

01

Introduction

From econometrics to ML. Python setup. The prediction vs. inference distinction.

Slides (coming soon)
02

Supervised Learning I

Linear regression as ML. Ridge, Lasso, and Elastic Net. Regularisation and variable selection.

Slides (coming soon)
03

Supervised Learning II

Classification: logistic regression, decision trees, random forests, gradient boosting.

Slides (coming soon)
04

Model Selection

Bias–variance trade-off. Cross-validation. Hyperparameter tuning.

Slides (coming soon)
05

Unsupervised Learning

Clustering (k-means, hierarchical). Dimensionality reduction (PCA).

Slides (coming soon)
06

Causal ML

Double/Debiased ML. Causal forests. Treatment effect heterogeneity.

Slides (coming soon)
07

Text as Data & NLP

Bag-of-words, TF-IDF, embeddings. Sentiment analysis. Topic modelling.

Slides (coming soon)
08

LLMs & AI in Research

Large Language Models. Prompt engineering. AI-assisted research. Course wrap-up.

Slides (coming soon)

Assessment

Final Assignment (70%): Apply ML methods from the course to an economic dataset. Submit a short analytical report with reproducible Python code.

Presentation (30%): A short presentation on a course-related topic or application, scheduled during the final weeks of term.

Assignment released: Week 7
Assignment due: One week after Lecture 8

Suggested Readings