6-1

a)

reg course_eval beauty

Source |

SS

df

MS

Number of obs =

-------------+------------------------------

F(

1,

463

461) =

17.08

Model |

5.08300731

5.08300731

Prob > F

0.0000

Residual |

137.155613

461

.297517598

R-squared

0.0357

Adj R-squared =

0.0336

Root MSE

.54545

-------------+-----------------------------Total |

142.23862

462

.307875801

-----------------------------------------------------------------------------course_eval |

Coef.

Std. Err.

P>|t|

[95% Conf. Interval]

-------------+---------------------------------------------------------------beauty |

.1330014

.0321775

4.13

0.000

.0697687

.1962342

_cons |

3.998272

.0253493

157.73

0.000

3.948458

4.048087

The estimated slope of the regression is 0.1330014

b) reg course_eval beauty intro onecredit female minority nnenglish

Source |

SS

df

MS

-------------+------------------------------

Number of obs =
F(

6,

463

456) =

13.90

Model |

21.9971655

3.66619426

Prob > F

0.0000

Residual |

120.241455

456

.263687401

R-squared

0.1546

Adj R-squared =

0.1435

Root MSE

.51351

-------------+-----------------------------Total |

142.23862

462

.307875801

-----------------------------------------------------------------------------course_eval |

Coef.

Std. Err.

P>|t|

[95% Conf. Interval]

-------------+---------------------------------------------------------------beauty |

.16561

.0307296

5.39

0.000

.1052208

.2259991

intro |

.011325

.0544778

0.21

0.835

-.0957338

.1183838

onecredit |

.6345271

.1113391

5.70

0.000

.4157257

.8533284

female |

-.1734774

.0492791

-3.52

0.000

-.2703197

-.0766352

minority |

-.1666154

.0762784

-2.18

0.029

-.3165162

-.0167147

nnenglish |

-.2441613

.1069578

-2.28

0.023

-.4543527

-.0339699

_cons |

4.068289

.037543

108.36

0.000

3.99451

4.142068

For each additional unit of Beauty, Course Evaluation will be increased by 0.166.
The R2 of the regression in (a) is too slow. It is 0.0357; it shows us that there is no
correlation between the variables, so there must be some omitted variable bias
that can be relevant in order to make the regression acceptable.

c) Professor Smith Course Evaluation

Course Evaluation = 4.07 + 0.166Beaty+ 0.011Intro + 0.634OneCredit
-0.173Female 0.167Minority 0.244NNNEnglish
Course Evaluation = 4.07 + 0.166(4.75) + 0.011(0) + 0.634(0) 0.173(0)
0.167(1) -0.244(0)
Course Evaluation = 4.6915

6-2
A.

. reg ed dist

Source |

SS

df

MS

Number of obs =

-------------+-----------------------------Model |

93.0256754

93.0256754

Residual |

12394.3568

3794

3.266831

F(

-------------+-----------------------------Total |

12487.3825

3795

3.29048287

1,

3796

3794) =

28.48

Prob > F

0.0000

R-squared

0.0074

Adj R-squared =

0.0072

Root MSE

1.8074

-----------------------------------------------------------------------------ed |

Coef.

Std. Err.

P>|t|

[95% Conf. Interval]

-------------+---------------------------------------------------------------dist |

-.0733727

.0137498

-5.34

0.000

-.1003304

-.046415

_cons |

13.95586

.0377241

369.95

0.000

13.88189

14.02982

Estimated slope is -0.0733727

B. . reg

ed dist bytest female black hispanic incomehi ownhome dadcoll cue80 stwmfg80

Source |

SS

df

MS

Number of obs =

-------------+------------------------------

F( 10,

3796

3785) =

146.35

Model |

3481.95254

10

348.195254

Prob > F

0.0000

Residual |

9005.42997

3785

2.37924173

R-squared

0.2788

Adj R-squared =

0.2769

Root MSE

1.5425

-------------+-----------------------------Total |

12487.3825

3795

3.29048287

-----------------------------------------------------------------------------ed |

Coef.

Std. Err.

P>|t|

[95% Conf. Interval]

-------------+---------------------------------------------------------------dist |

-.0315387

.0123703

-2.55

0.011

-.0557918

-.0072857

bytest |

.0938201

.0031622

29.67

0.000

.0876204

.1000199

female |

.145408

.0505889

2.87

0.004

.0462239

.244592

black |

.367971

.071363

5.16

0.000

.2280574

.5078846

hispanic |

.3985196

.0744617

5.35

0.000

.2525308

.5445085

incomehi |

.3951984

.0605308

6.53

0.000

.2765222

.5138746

ownhome |

.1521313

.0668075

2.28

0.023

.0211492

.2831135

dadcoll |

.6961324

.0687248

10.13

0.000

.5613911

.8308737

cue80 |

.0232052

.0096321

2.41

0.016

.0043207

.0420898

stwmfg80 |

-.0517777

.0198523

-2.61

0.009

-.0906999

-.0128556

_cons |

8.827518

.2502782

35.27

0.000

8.336825

9.318211

The effect on ED from Dist is -0.0315387.

C. Yes it is substantially different, taking into consideration that the difference is 0.041834
in slopes. No, it does not suffer from omitted variable bias.
D. R Squared for A is 0.0074 and R Squared for B is 0.2788 ; STR for A is 0.0137498 and B
0.0123703; Adjusted RSquare for A is 0.0072 and for B is 0.2788. Since Adjusted R Squared

is being taken from a population rather than a sample, Adjusted R Squared is of little or no
different value from R Squared.
E. This coefficient stated that if the students father is a College Graduate the odds of
completing education become higher.
F. They appear because employment would have been easier to achieve if education was
completed, therefore the higher the unemployment rate, the higher the motivation to
complete education. State hourly wage in manufacturing appears because the higher the
wage, the more students would be likely to drop out of school to go earn money quick.
Yes the signs are what I believed because it represents the most logical scenario. For every
unit of unemployment rate that goes up, completed education will go up by 0.232052 and
for every unit of state hourly earnings in manufacturing completed education will go down
by 0.517777.
G. Y= 8.83 - 0.032(2) + 0.094(58) + 0.395 + 0.152 + 0.0232(7.5) 0.5178(9.75) = 9.89 years
of ED
H. Y= 8.83 - 0.032(4) + 0.094(58) + 0.395 + 0.152 + 0.0232(7.5) 0.5178(9.75) = 9.83 years
of ED

-3

a. summarize

Variable |

Obs

Mean

Std. Dev.

Min

Max

-------------+-------------------------------------------------------growth |

64

1.86912

1.816189

-2.811944

7.156855

rgdp60 |

64

3130.813

2522.979

366.9999

9895.004

tradeshare |

64

.5423919

.2283326

.140502

1.127937

yearsschool |

64

3.959219

2.553465

.2

10.07

rev_coups |

64

.1700666

.2254557

.9703704

-------------+-------------------------------------------------------assasinati~s |

64

.281901

SS

df

.494159

2.466667

b.

Source |

MS

-------------+------------------------------

Number of obs =
F(

5,

64

58) =

4.76

Model |

60.4973376

12.0994675

Prob > F

0.0010

Residual |

147.310822

58

2.53984176

R-squared

0.2911

Adj R-squared =

0.2300

Root MSE

1.5937

-------------+-----------------------------Total |

207.80816

63

3.29854222

------------------------------------------------------------------------------

growth |

Coef.

Std. Err.

P>|t|

[95% Conf. Interval]

-------------+---------------------------------------------------------------tradeshare |

1.340819

.9600631

1.40

0.168

-.5809558

3.262594

yearsschool |

.5642445

.1431131

3.94

0.000

.2777726

.8507165

rev_coups |

-2.150426

1.11859

-1.92

0.059

-4.389527

.0886756

assasinati~s |

.3225844

.4880043

0.66

0.511

-.6542624

1.299431

rgdp60 |

-.0004613

.0001508

-3.06

0.003

-.0007631

-.0001594

_cons |

.6268915

.783028

0.80

0.427

-.9405093

2.194292

The value of the coefficient on Rev_Coups is -2.15 and it is relatively large in a real world-sense
because not all the countries went through revolutions, insurrections or coup detats during the
period of 1960 to 1995.

c. Growth= 0.6268915+ 1.340819(0.5423919)+0.5642445 (3.959219)-2.150426

(0.1700666)+0.3225844(0.281901)-0.0004613 (3130.813)= 1.8690856

d. Growth= 0.6268915+ 1.340819(0.5423919+ 0.2283326)+0.5642445 (3.959219)-2.150426

(0.1700666)+0.3225844(0.281901)-0.0004613 (3130.813)= 2.175367314

e. Oil variable is omitted from the regression because even though the oil will explain a significant
part of a country growth rate, not all the countries have this rich natural resource.