Sometimes, the pattern of coefficients on the year dummy variables is itself of interest. For example, a demographer may be interested in the following question: After controlling for education, has the pattern of fertility among women over age 35 changed between 1972 and 1984? The following table illustrates how this question is simply answered by using multiple regression analysis with year dummy variables. The table below presents the results from a study carried out on the total number of kids born to a woman. The factors that are controlled for are years of education, age, race, region of the country where living at age 16, and living environment at age 16. Suppose that we want to estimate the effect of several variables on annual saving and that we have a panel data set on individuals collected on January 31, 1990, and January 31, 1992. If we include a year dummy for 1992 and use first differencing, can we also include age in the original model?
|
Sometimes, the pattern of coefficients on the year dummy variables is itself of interest. For example, a demographer may be interested in the following question: After controlling for education, has the pattern of fertility among women over age 35 changed between 1972 and 1984? The following table illustrates how this question is simply answered by using multiple The table below presents the results from a study carried out on the total number of kids born to a woman. The factors that are controlled for are years of education, age, race, region of the country where living at age 16, and living environment at age 16. |
|
Suppose that we want to estimate the effect of several variables on annual saving and that we have a panel data set on individuals collected on January 31, 1990, and January 31, 1992. If we include a year dummy for 1992 and use first differencing, can we also include age in the original model? |
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
