LAB4 Codes

E 7.1

Data: http://wps.aw.com/aw_stock_ie_3/178/45691/11696965.cw/

Clear and load dataset

clear
cd "E:\Econ 107\LAB1\data" 
use cps08.dta

(a) Regress AHE on AGE

\[AHE=\beta_0+\beta_1 AGE+u\]

With robust standard error

reg ahe age, robust

Results:

Linear regression                               Number of obs     =      7,711
                                                F(1, 7709)        =     225.70
                                                Prob > F          =     0.0000
                                                R-squared         =     0.0290
                                                Root MSE          =     9.9919

------------------------------------------------------------------------------
             |               Robust
         ahe |      Coef.   Std. Err.      t    P>|t|     [95% Conf. Interval]
-------------+----------------------------------------------------------------
         age |   .6049863   .0402701    15.02   0.000      .526046    .6839266
       _cons |   1.082275   1.167013     0.93   0.354    -1.205388    3.369938
------------------------------------------------------------------------------

With robust standard error

reg ahe age, robust

Results:

      Source |       SS           df       MS      Number of obs   =     7,711
-------------+----------------------------------   F(1, 7709)      =    230.43
       Model |  23005.7375         1  23005.7375   Prob > F        =    0.0000
    Residual |  769645.718     7,709  99.8372964   R-squared       =    0.0290
-------------+----------------------------------   Adj R-squared   =    0.0289
       Total |  792651.456     7,710   102.80823   Root MSE        =    9.9919

------------------------------------------------------------------------------
         ahe |      Coef.   Std. Err.      t    P>|t|     [95% Conf. Interval]
-------------+----------------------------------------------------------------
         age |   .6049863   .0398542    15.18   0.000     .5268613    .6831113
       _cons |   1.082275   1.184255     0.91   0.361    -1.239187    3.403737
------------------------------------------------------------------------------

The difference is the standard error Std. Err..

(b) Regress AHE on AGE, Female and Bachelor

\[AHE=\beta_0+\beta_1 AGE+\beta_2Female+\beta_3Bachelor+u\]

reg ahe age female bachelor, robust

Results:

Linear regression                               Number of obs     =      7,711
                                                F(3, 7707)        =     555.48
                                                Prob > F          =     0.0000
                                                R-squared         =     0.1998
                                                Root MSE          =     9.0718

------------------------------------------------------------------------------
             |               Robust
         ahe |      Coef.   Std. Err.      t    P>|t|     [95% Conf. Interval]
-------------+----------------------------------------------------------------
         age |   .5852144   .0365302    16.02   0.000     .5136052    .6568236
      female |  -3.664026   .2076129   -17.65   0.000    -4.071003   -3.257048
    bachelor |   8.083001   .2126945    38.00   0.000     7.666062     8.49994
       _cons |  -.6356977   1.083075    -0.59   0.557    -2.758818    1.487423
------------------------------------------------------------------------------

(c)

The results regarding the effects of Age and AHE from (a) and (b) do not change a lot. Thus, this model does not suffer from omitted variable bias.

(d)

Bob is a 26-year-old male worker with a high school diploma:

dis 30*.5852144-3.664026*0+8.083001*0-.6356977

Alexis is a 30-year-old female worker with a college degree:

dis 30*.5852144-3.664026*1+8.083001*1-.6356977

E 7.2

Clear and load dataset

clear
cd "E:\Econ 107\LAB1\data" 
use TeachingRatings.dta

(a) Regress Course_Eval on Beauty

reg course_eval beauty, robust

Results:

Linear regression                               Number of obs     =        463
                                                F(1, 461)         =      16.94
                                                Prob > F          =     0.0000
                                                R-squared         =     0.0357
                                                Root MSE          =     .54545

------------------------------------------------------------------------------
             |               Robust
 course_eval |      Coef.   Std. Err.      t    P>|t|     [95% Conf. Interval]
-------------+----------------------------------------------------------------
      beauty |   .1330014   .0323189     4.12   0.000     .0694908    .1965121
       _cons |   3.998272   .0253493   157.73   0.000     3.948458    4.048087
------------------------------------------------------------------------------

(b)

reg course_eval beauty, robust
outreg2 using TeacherTable.xml, replace 

reg course_eval beauty age, robust
outreg2 using TeacherTable.xml 

reg course_eval beauty age female, robust
outreg2 using TeacherTable.xml 

reg course_eval beauty age female intro, robust
outreg2 using TeacherTable.xml

reg course_eval beauty age female intro nnenglish, robust
outreg2 using TeacherTable.xml

reg course_eval beauty age female intro nnenglish minority, robust
outreg2 using TeacherTable.xml

reg course_eval beauty age female intro nnenglish minority onecredit, robust
outreg2 using TeacherTable.xml