ECON 306 - Homework 4

A solved homework set for ECON 306 covering economic principles.

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ECON 306-Homework 4The following two problems will require a lot of calculations in. It will generate many pages of output.Here is how your should organize it.The first pages should contain your answers to all the questions,along with showing any key algebraic equations or explanations you need to use along the way.After that, include a printout of the output from the regressions you executed in support of your answers.Highlight any numbers in this output that you used in the first section. (You are encouraged to save paperhere, you may print this section with a small font, double-sided and/or with 2-up format.)Last, include acopy of the DO file that contains the commands you asked STATA to execute.Be sure you organizethese in a way that will be clear to the reader.

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1)In this exercise we will examinewhether a teacher’s physical attractiveness has any impacton student course evaluations. The dataset to use is called teachingratings, and a descriptionof the variables is availableas well.You can accessthesethrough the course website.Useanα=.05 for hypothesis testing.We’ll first examine whether our control variables seem to have any predictive power forratings.a.)We’ll start with some basic dummy variable regressions to test for differences betweengroups:1)Regresscourse_eval onminority.Report the coefficients and p-values.Do minorityinstructorshave significantly different course evaluations compared to non-minorities?𝒄𝒐𝒖𝒓𝒔𝒆𝒆𝒗𝒂𝒍=𝟒.𝟎𝟏𝟎.𝟏𝟐𝟑𝟏𝒎𝒊𝒏𝒐𝒓𝒊𝒕𝒚,𝒑𝒗𝒂𝒍𝒖𝒆=𝟎.𝟎𝟗𝟗So being minority is not significant in evaluation result at 5% significance level.(Although it is significant and negative at 10% level)2)Regress course_eval on female.Report the coefficients and p-values.Do femaleshave significantly different course evaluations from males?𝒄𝒐𝒖𝒓𝒔𝒆𝒆𝒗𝒂𝒍=𝟒.𝟎𝟔𝟎.𝟏𝟔𝟖𝒇𝒆𝒎𝒂𝒍𝒆,𝒑𝒗𝒂𝒍𝒖𝒆=𝟎.𝟎𝟎𝟏Yes, Being female will decrease the evaluation score by 0.168, it is significant at 1% level.3)Run a final regression to test whether theeffect of being a minority changesdepending on whether the person is female.Report the coefficients and p-values.Canyou reject the hypothesis of no effect?𝒄𝒐𝒖𝒓𝒔𝒆𝒆𝒗𝒂𝒍=𝟒.𝟎𝟕𝟎.𝟏𝟔𝒇𝒆𝒎𝒂𝒍𝒆𝟎.𝟎𝟗𝟔𝟖𝒎𝒊𝒏𝒐𝒓𝒊𝒕𝒚,𝒑𝒗𝒂𝒍𝒖𝒆:𝒇𝒆𝒎𝒂𝒍𝒆:𝟎.𝟎𝟎𝟐After controlling for being minority, being female still has a significant negativeimpact on evaluation. Yes, you can reject the hypothesis of no effect.b.)Now regress course_eval on beauty, age, age^2[you’ll need to create this], nnenglish,female, minority, onecredit. Are any variablesnotstatistically significant? Which?Thisis Model 1.𝑴𝒐𝒅𝒆𝒍𝟏:𝒄𝒐𝒖𝒓𝒔𝒆𝒆𝒗𝒂𝒍=𝜷𝟎+𝜷𝟏𝒃𝒆𝒂𝒖𝒕𝒚+𝜷𝟐𝒂𝒈𝒆+𝜷𝟑𝒂𝒈𝒆𝒔𝒒+𝜷𝟒𝒏𝒏𝒆𝒏𝒈𝒍𝒊𝒔𝒉+𝜷𝟓𝒇𝒆𝒎𝒂𝒍𝒆+𝜷𝟔𝒎𝒊𝒏𝒐𝒓𝒊𝒕𝒚+𝜷𝟕𝒐𝒏𝒆𝒄𝒓𝒆𝒅𝒊𝒕age and age^2 are not significant. nnenglish and minority are significant at 5% level butnot at 1% level.Use Model 1 to answer the following:1)Calculate an F-testfor the hypothesisthat age and age^2 jointly have no effectoncourse_eval. You can execute this test however youprefer.𝑭(𝟐,𝟒𝟓𝟓)=𝟎.𝟕𝟑The answer is not significant, so we can not reject that age and age^2 have no effect oncourse-eval.
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