Complete the following in Excel: Based on the Current Population Survey (CPS) of March 1995, Paul Rudd extracted a sample of 1289 workers, aged 18 to 65, and obtained the following information on each worker:
- Wage = hourly wage in $
- Age = age in years
- Female = 1 if female worker
- Nonwhite = 1 if a nonwhite worker
- Union = 1 if a union member
- Education = years of schooling
- Experience = potential labor market experience in years
- The full data set can be found as Table 6-16 on the textbook's Web site.
- Based on these data, estimate the following model, obtaining the usual regression statistics. 1n Wagei = B1 + B2 Age + B3 Female + B4 Nonwhite + B5 Union + B6 Education + B7 Experience + ui where 1n Wage = (natural logarithm of Wage)
- How do you interpret each regression coefficient?
- Which of these coefficients are statistically significant at the 5% level? Also obtain the p value of each estimated t value.
- Do union workers, on average, earn a higher hourly wage?
- Do female workers, on average, earn less than their male counterparts?
- Is the average hourly wage of female nonwhite workers lower than the average hourly wage of female white workers? How do you know? (Hint: interaction dummy.)
- Is the average hourly wage of female union workers higher than the average hourly wage of female non-union workers? How do you know?