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. Ap :-· , T I AaBbCcDdEe AaBbCcDdEe AaBbCcD Normal No Spacing Heading 1 & Consider the following wage regression in whch you have data on gnder, thee racial groups and education (educ). The dummy variables are defined as follows F equals 1 if "male and O otherw A equals t E Asian and O otherwise 8 equals 1 if Black and 0 otherwise wequals 1 white and 0 othentie. The estimated sample regression function is given by loge-age)-1.25-0.15x,-0.20 x B + 0.15 x A + 0.02 ×(FXA)-0.03 ×(FiR) +008 (a) Fill in the tabsle below with the mean predkted log(wage) for males and females arone different racial groups who have 0 years of education by What is the refenence group in this regression c) Interpeet each coefficient estimate in the above regnession d) Compute the male-female wage differeninial across ditferent racial groupe. Are they the same? Describe how would you test the hypothesis that the male-temale wage difference is the ame across al racial groups? (e) Compute the wage diferential across diffierent racial groups first for males and the f females How w you test the hypothesis that-is no wage dilinntial across different racial groups? Is the test diffeent from that in part (d)? Your trend i, using the s-dasa but writes the model dinmaly. The mald OShe estimates looka like kirw)-"o +e,AM + "aAF + ,BM + .SF +@yww + a. edMe, where the dummy variables are defined as follows AM equals 1 if Asian male and 0 otherwise AF equals 1 Asian female and O otherwise BM equals 1 if Black male and 0otherwis BF equals Tif BMack female and 0 oderwis WM equals 1 if White make and 0 otherwise. Use the results from either the regression above or the table that you have populated in part (a) to compute the estimates of the regression coofficient for your friend's molelExplanation / Answer
For Asian male put A=1, F=0 B= 0. For black put A=F=0, B= 1.For white B=F=A =0 .
For Asian female put A=1, F=1 B= 0. For black put A=0, F= B= 1.For white B=A =0 .
b) Reference group in the group is male for gender and white for race.
d) the coefficient of the interaction term gives the differential wage for different race and gender.
We will check for the null hypothesis that the coefficents for interaction terms equal 0 against atleast one is non-zero.
Asian Black White Male 1.4 1.05 1 Female 1.12 1.07 1.1Related Questions
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