Roots in the Ground
This is the name of a variable that is either true or false.
What is a dummy/dichotomous/indicator variable?
This is the tool used to test joint hypotheses.
What is an F-test?
ahei-hat= 10-2agei-1.25femalei
This is the interpretation for the coefficient on female.
What is, on average, females earn $1.25/hr less than males?
This is what you call a model with a logarithmic X variable and a linear Y variable.
What is a lin-log model?
These are the two conditions for omitted variable bias.
corr(X1,X2) != 0
B2 != 0 (corr(X2,Y) != 0)
This is why we use a reference category?
What is avoiding the dummy variable trap?
This is your T-stat if:
H0: B0=0, HA: B0!=0
B1-hat = 4, SE = 2
Alpha = 5%
What is T = 2?
Yi= B0+B1X1i+B2Di+B3(Di x X1i)+ei
For the above model, these coefficients are statistically significant to have different intercepts and different slopes.
What is B2 and B3?
This type of model is appropriate for measuring elasticity.
What is a log-log model?
This is what happens to your B1 when B2>0 and corr(X1,X2) = 0.
What is no bias?
This is an ordinal variable.
What is a variable that expresses rank but not magnitude?
Standardize the following subset of Xi:
X4,5,6 = {2, -3, 8}
sd(X) = 4
mean(X) = 3
What is {-0.25, -1.5, 1.25}
This is the interpretation of the coefficient on south.
Region | ahe
NE | 2.02
MidW | -1.59
South | -2.13
West |
Const | 12.50
What is, on average, people who live in the south earn $2.13/hr less than those who live in the west?
This is the interpretation for a lin-log model with B1 = 112.
What is a 1% increase in X being associated with a 1.12-unit change in Y, on average?
This is what happens to your B1 when B2<0 and corr(X1,X2) > 0.
What is an understated estimate?
This is how one writes the restricted model.
What is assume the null hypothesis?
Given the model:
gradei = 20+7studyi+4studyi2-0.5studyi3
A 1-hour increase in hours studied from 3 to 4 has this much of an expected increase in grade.
What is 23.5?
(80-63.5)
Yi= B0+B1X1i+B2Di+B3(Di x X1i)+ei
For the above model, these coefficients are statistically significant to have the same intercepts and different slopes.
What is B3?
This is the interpretation for a log-log model with B1 = 3.14.
What is a 1% increase in X is associated with a 3.14% increase in Y, on average?
This is what happens to your B1 when B2<0 and corr(X1,X2) < 0.
What is an overstated estimate?
These are the conditions for OLS to be BLUE.
1. The conditional distribution of ei given Xi has a zero mean
2. Xi and Yi are independently and identically distributed (i.i.d.)
3. Large outliers are unlikely
4. Errors are homoskedastic
These are the restricted and unrestricted models for a joint test of significance on B1 and B2.
Yi= B0+B1X1i+B2X2i+B3X3i+ei
What are,
U: Yi= B0+B1X1i+B2X2i+B3X3i+ei
R: Yi= B0+B3X3i+ei?
ahei-hat= 3.31+3.60femalei+0.59agei-0.30(agei x femalei)
This is the meaning of the effect of female on average hourly earnings.
What is, on average, women initially earn more than men but see their salaries increase more slowly over time?
This is how you compare the R2 of a log-lin model with a lin-lin model.
What is no comparison?
This is the reason for choosing a model form.
BONUS
This is not a valid reason for choosing a model form.
What is economic theory or economic intuition?
BONUS
What is comparing R2 between models with different dependent variables?