We observe a panel data of (Yit, Xit). Which of the following condition(s) are sufficient for us to obtain a consistent estimate of B?

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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Consider a simple model of marriage and wage
Yit = BXit + Sit + Vit
where Y is the wage, X is a dummy variable indicating the marital
status, S represents "sociability," and V contains other unobserved
causal factors. Assume that Vit is independent of Xis for all i, t, s.
We observe a panel data of (Yit, Xit). Which of the following
condition(s) are sufficient for us to obtain a consistent estimate of
B?
Sit is independent of Xit
Sit does not vary with time t
Vit does not vary with time t
Sit is independent of Vit
Transcribed Image Text:Consider a simple model of marriage and wage Yit = BXit + Sit + Vit where Y is the wage, X is a dummy variable indicating the marital status, S represents "sociability," and V contains other unobserved causal factors. Assume that Vit is independent of Xis for all i, t, s. We observe a panel data of (Yit, Xit). Which of the following condition(s) are sufficient for us to obtain a consistent estimate of B? Sit is independent of Xit Sit does not vary with time t Vit does not vary with time t Sit is independent of Vit
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