Question 3 Suppose you have a model: wage; = a, + a,educ; + azIQ; + azexper, + a,DM; + a;DF; + a,DE; + €l where: wage .. annual wage the individual earns in £ educ .. years of education IQ ... IQ level exper ... years of on-the-job experience .. dummy, equal to one for males and zero for females .. dummy, equal to one for French-only speakers and zero otherwise ... dummy, equal to one for English-only speakers and zero otherwise ... represents the error term DM DF DE . Suppose further that you have a sample of n individuals who speak only French, only English, or are bilingual. a) What would you expect the sign of a1, az and az to be and why? b) Explain why a dummy equal to one for bilingual people and zero otherwise is not included in the model. c) Explain how you would test for discrimination against females (in the sense that ceteris paribus females earn less than males). Be specific: state the hypothesis, give the test statistic and conclude.
Question 3 Suppose you have a model: wage; = a, + a,educ; + azIQ; + azexper, + a,DM; + a;DF; + a,DE; + €l where: wage .. annual wage the individual earns in £ educ .. years of education IQ ... IQ level exper ... years of on-the-job experience .. dummy, equal to one for males and zero for females .. dummy, equal to one for French-only speakers and zero otherwise ... dummy, equal to one for English-only speakers and zero otherwise ... represents the error term DM DF DE . Suppose further that you have a sample of n individuals who speak only French, only English, or are bilingual. a) What would you expect the sign of a1, az and az to be and why? b) Explain why a dummy equal to one for bilingual people and zero otherwise is not included in the model. c) Explain how you would test for discrimination against females (in the sense that ceteris paribus females earn less than males). Be specific: state the hypothesis, give the test statistic and conclude.
Algebra & Trigonometry with Analytic Geometry
13th Edition
ISBN:9781133382119
Author:Swokowski
Publisher:Swokowski
Chapter4: Polynomial And Rational Functions
Section4.6: Variation
Problem 7E
Related questions
Question
Transcribed Image Text:Question 3
Suppose you have a model:
wage; = a, + a,educ; + azIQ; + azexper, + a,DM; + «;DF; + a,DE; + €l
where:
wage .. annual wage the individual earns in £
educ .. years of education
IQ
... IQ level
eXper ... years of on-the-job experience
DM
DF
.. dummy, equal to one for males and zero for females
.. dummy, equal to one for French-only speakers and zero otherwise
... dummy, equal to one for English-only speakers and zero otherwise
DE
... represents the error term
Suppose further that you have a sample of n individuals who speak only French, only
English, or are bilingual.
a) What would you expect the sign of a1, az and az to be and why?
b) Explain why a dummy equal to one for bilingual people and zero otherwise is
not included in the model.
c) Explain how you would test for discrimination against females (in the sense that
ceteris paribus females earn less than males). Be specific: state the hypothesis,
give the test statistic and conclude.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps with 3 images
Recommended textbooks for you
Algebra & Trigonometry with Analytic Geometry
Algebra
ISBN:
9781133382119
Author:
Swokowski
Publisher:
Cengage
Holt Mcdougal Larson Pre-algebra: Student Edition…
Algebra
ISBN:
9780547587776
Author:
HOLT MCDOUGAL
Publisher:
HOLT MCDOUGAL
Algebra & Trigonometry with Analytic Geometry
Algebra
ISBN:
9781133382119
Author:
Swokowski
Publisher:
Cengage
Holt Mcdougal Larson Pre-algebra: Student Edition…
Algebra
ISBN:
9780547587776
Author:
HOLT MCDOUGAL
Publisher:
HOLT MCDOUGAL
College Algebra (MindTap Course List)
Algebra
ISBN:
9781305652231
Author:
R. David Gustafson, Jeff Hughes
Publisher:
Cengage Learning
Mathematics For Machine Technology
Advanced Math
ISBN:
9781337798310
Author:
Peterson, John.
Publisher:
Cengage Learning,