{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

Problem 3 Problem Set 2

Problem 3 Problem Set 2 - w2 reg e1w1r1 Then we see that...

Info icon This preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
In order to run a regression on the effort of type 1 workers with the wage of type 1 workers, we need to use the command reg e1w1 . We receive a standard error output of .0316538 . After running another regression ( reg e2w2 ) between the effort of worker 2 with the wage of worker 2, we receive a standard error output of .0261249 . Then in order to test the hypothesis that the coefficient on own wage equals the coefficient on relative wage we must run the regression between the effort and wage of worker 1 with the relative wage (w1 –
Image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: w2): reg e1w1r1 . Then we see that the coefficient of the relative wage is .7373911 . Then in order to test the hypothesis we use the command: testw1 - .7373911 . From this result we see that this is a very unlikely probability with a probability of 0% and an F distribution (1,1107) = 2521.11. Therefore, it is very unlikely the coefficient of ones own wage will equal the coefficient of the relative wage....
View Full Document

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern