week4qs - ˆ β 1 in the regression of ahe on female 5 How...

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Week 4 questions For questions 1 - 6, use the dataset ahe.dta Variables: ahe : Average hourly earnings female: 1 for females, 0 for males bachelor: 1 for Bachelor’s degree, 0 for high school 1. Run a regression of ahe on female. 2. Test the claim that males and females have the same hourly earnings. 3. Generate a variable male = 1 - female. Without using Stata, write down the estimates you will obtain for ˆ β 0 and ˆ β 1 in a regression of ahe on male. Now check your answers using Stata. 4. Suppose ahe depends on the age of a person as well. What is the direction of bias for
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Unformatted text preview: ˆ β 1 in the regression of ahe on female? 5. How can you fix this problem? 6. Check whether your predicted direction of bias matches the results you obtain from Stata? 7. Suppose we were interested in determining the effects of smoking during pregnancy on infant health, as measured by birth weight. Suppose however that in estimating the relationship between birth weight and smoking we do not observe family income, which we believe to be positively related to birth weight. What is the sign of the bias on the coefficient on smoking? 1...
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