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120_spring08_pset2

# 120_spring08_pset2 - ECO 120 Problem Set 2 Due Friday April...

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ECO 120 Problem Set 2 Due: Friday, April 25th (by end of class). No late problem sets will be accepted. 1. A researcher obtains data on the distribution and use of insecticide-infused nets in a malaria-infested region where the UN has been distributing these nets at random to the population. Sleeping with the nets surrounding one°s bed prevents mosquitoes from biting and therefore is thought to reduce the probability of contracting malaria. For a random sample of individuals, the researcher constructs 3 variables: given , a dummy variable measuring whether an individual was given a net through the program; used , a dummy variable for whether the individual actually used a net (either through the program or from some other source); and malaria , a dummy variable for whether the individual actually contracted malaria. We are interested in 3 questions: 1. Does net use reduce the probability of getting malaria? 2. What is the probability that someone that is given a net will actually use it? How does this compare to the probability that somebody that is not given the net will buy one on their own and use it? 3. How does giving someone a net a/ect their probability of getting malaria? (a) Write out the 3 simple Ordinary Least Squares (OLS) regressions to answer each question. These regressions will all include only 1 independent variable. (b) Under what assumptions do these regressions give unbiased estimates of causal e/ects? For each regression, describe whether these assumptions are plausible. (c) Assume that your regressions yielded the following coe¢ cients (standard errors in parentheses): 1

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Dependent Variables used a net had malaria had malaria had malaria (1) (2) (3) (4) constant 0.120 0.416 0.411 0.407 (0.052)
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