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Logs in econometrics - change in the dependent variable for...

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A simple example of a relationship in econometrics from the field of labor economics is: ln(wage) = ά + β 1 (years of education) + ε Why do we use natural logs? Well if we use a semi-log form (only the dependent variable is in logarithmic form), then the results are the %age
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Unformatted text preview: change in the dependent variable for a one unit change in the independent variable. For a log-log form (when both are in the form of logs) we get a %age change in Y for a 1% change in X....
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