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Chapter 3: Review of Statistics 3.1 (a) Average Hourly Earnings, Nominal $s AHE1992 AHE2008 AHE2008 AHE1992 (b) Average Hourly Earnings, Real $2008 AHE1992 AHE2008 AHE2008 AHE1992 Mean 17.83 18.98 Difference 1.14 SE(Mean) 0.099 0.115 SE(Difference) 0.152 95% Confidence Interval 17.63 18.03 18.75 19.20 95% Confidence Interval 0.85 1.44 Mean 11.63 18.98 Difference 7.35 SE(Mean) 0.064 0.115 SE(Difference) .132 95% Confidence Interval 11.50 11.75 18.75 19.20 95% Confidence Interval 7.09 7.61
(c) The results from part (b) adjust for changes in purchasing power. These results should be used. (d) Average Hourly Earnings in 2008 High School College College-High School (e) Average Hourly Earnings in 1992 (in $2008) High School College College-High School Mean 15.31 21.78 Difference 6.47 SE(Mean) 0.103 0.171 SE(Difference) 0.200 1 95% Confidence Interval 15.11 15.52 21.45 22.12 95% Confidence Interval 6.08 6.86 Mean 15.33 22.91 Difference 7.58 SE(Mean) 0.122 0.180 SE(Difference) 0.217 95% Confidence Interval 15.09 15.57 22.56 23.26 95% Confidence Interval 7.15 8.00
(f) Average Hourly Earnings in 2008 AHEHS,2008 AHEHS,1992 AHECol,2008 AHECol,1992 Col-HS Gap (1992) Col-HS Gap (2008) Gap2008 Gap1992 Mean 0.02 1.13 6.47 7.58 Difference 1.01 SE(Mean) 0.160 0.248 0.200 0.217 SE(Difference) 0.295 95% Confidence Interval 0.29 0.33 0.64 1.61 6.08 6.86 7.15 8.00 95% Confidence Interval 0.71 1.31
Wages of high school graduates increased by an estimated 0.33 dollars per hour (with a 95% confidence interval of 0.06 0.60); Wages of college graduates increased by an estimated 1.24 dollars per hour (with a 95% confidence interval of 0.82 1.66). The College-High School increased by an estimated 0.91 dollars per hour.
(g) Gender Gap in Earnings for High School Graduates Year 1992 2008
Ym 16.55 16.58
sm 7.45 8.16
nm 2769 2537
Yw 13.48 13.15
sw 5.96 6.27
nw 1874 1465
Ym Yw 3.07 3.43
There is a large and statistically significant gender gap in earnings for high school graduates. In 2008 the estimated gap was $3.43 per hour; in 1992 the estimated gap was $3.07 per hour (in $2008). The increase in the gender gap is somewhat smaller for high school graduates than it was for college graduates.
Chapter 4: Linear Regression with One Regressor 4.1. (a) AHE = 1.08 + 0.60 Age Earnings increase, on average, by 0.60 dollars per hour when workers age by 1 year. (b) Bobs predicted earnings = 1.08 + (0.60 26) = $16.68 Alexiss predicted earnings = 1.08 + (0.60 30) = $19.08 (c) The regression R2 is 0.03.This means that age explains a small fraction of the variability in earnings across individuals. 4.2. (a)
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Course Evaluation
2 -2 -1 0 Beauty Index 1 2
There appears to be a weak positive relationship between course evaluation and the beauty index.