Question 1 Suppose that you are interested in estimating the ceteris paribus relationship between wage and educ. For this purpose, you can collect data on a control variable, exper. Let ai be the simple regression estimate from wage on educ and let b₁ be the multiple regression estimate from wage on educ and exper. (That is, both a₁ and b₁ are estimated coefficients of educ.) Answer the following questions. (i) If educ is highly negatively correlated with exper in the sample, and exper has positive and large partial effects on wage, which relationship between a₁ and b₁ is most appropriate?
Question 1 Suppose that you are interested in estimating the ceteris paribus relationship between wage and educ. For this purpose, you can collect data on a control variable, exper. Let ai be the simple regression estimate from wage on educ and let b₁ be the multiple regression estimate from wage on educ and exper. (That is, both a₁ and b₁ are estimated coefficients of educ.) Answer the following questions. (i) If educ is highly negatively correlated with exper in the sample, and exper has positive and large partial effects on wage, which relationship between a₁ and b₁ is most appropriate?
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
Problem 1P
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Transcribed Image Text:Question 1
Suppose that you are interested in estimating the ceteris paribus relationship between wage and educ. For this
purpose, you can collect data on a control variable, exper. Let a₁ be the simple regression estimate from wage on
educ and let b₁ be the multiple regression estimate from wage on educ and exper. (That is, both a₁ and b₁ are
estimated coefficients of educ.) Answer the following questions.
(i)
If educ is highly negatively correlated with exper in the sample, and exper has positive and large partial
effects on wage, which relationship between a₁ and b₁ is most appropriate?
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