# ProblemSet4 - ECON 3200 Introduction to Econometrics...

This preview shows pages 1–2. Sign up to view the full content.

ECON 3200 Introduction to Econometrics Problem set 4 (due date: March 24, 2009) Problem 1 (Wooldridge 7.6) To test the e/ectiveness of a job training pro- gramme on the subsequent wages of workers, we specify the model log ( wage ) = & 0 + 1 train + 2 educ + 2 exper + u; where train is a binary variable equal to unity if a worker participated in the programme. Think of the error term u as containing unobserved worker ability. If less able workers have a greater chance of being selected for the programme, and you use an OLS analysis, what can you say about the likely bias in the OLS estiamtor of 1 ? [ Hint : Refer back to Chapter 3.] Problem 2. (Wooldridge 7.10) For a child living in a particular school district, let voucher i be a dummy variable equal to one if a child is selected to par- ticipate in a school voucher programme, and let score i score on a subsequent standardized exam. Suppose that the participation variable, voucher i is completely randomized in the sense that it is inde-

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
This is the end of the preview. Sign up to access the rest of the document.

## This note was uploaded on 10/03/2009 for the course ECON 3200 taught by Professor Neilsen during the Spring '08 term at Cornell University (Engineering School).

### Page1 / 2

ProblemSet4 - ECON 3200 Introduction to Econometrics...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online