1 Let kids denote the number of children ever born to a woman, and let educ denote years of education for the woman. A simple model relating fertility to years of education is kids = Bo + Bjeduc + u, where u is the unobserved error. (i) What kinds of factors are contained in u? Are these likely to be correlated with level of education? (ii) Will a simple regression analysis uncover the ceteris paribus effect of education on fertility? Explain.

1 Let kids denote the number of children ever born to a woman, and let educ denote years of education for the woman. A simple model relating fertility to years of education is kids = Bo + Bjeduc + u, where u is the unobserved error. (i) What kinds of factors are contained in u? Are these likely to be correlated with level of education? (ii) Will a simple regression analysis uncover the ceteris paribus effect of education on fertility? Explain.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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a) The R? should not be used to choose the best econometric model specification in multiple regression models. True or False
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