140_problems4

140_problems4 - ECON 140 Fall 2008 Alex Rothenberg Practice...

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Unformatted text preview: ECON 140, Fall 2008 Alex Rothenberg Practice Problems: Multiple Regression, Regression on Indicators, Interactions Problem 1 This problem asks you to look at the results of a famous (and controversial) study: Donohue, J. and S. Levitt (2001) “The Impact of Legalized Abortion on Crime”, Quarterly Journal of Economics 66(2) pp. 379-420. The authors estimate the parameters of the following regression equation using data from all 50 states (plus D.C.), indexed by s , and years, t = 1985- 1997. ln CRIME st = β ABORT st + K X k =1 θ k X k,st + γ s + η t + ε st Table 3 presents summary statistics for the variables used in estimating this equation, and Table 4 presents the regression results. The variable ABORT st is called “effective abortions”, essentially coded as the number of abortions in state s at year t- 18. 1 The authors do some fancy things when estimating this equation, but we’re going to assume that it was estimated using OLS. The number of observations in each equation isusing OLS....
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140_problems4 - ECON 140 Fall 2008 Alex Rothenberg Practice...

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