hourlywage= -0.31 + 8.31(bsdegree) + 1.34(female) + 0.58(age) - 3.73(fem_bsdeg)

Question

hourlywage= -0.31 + 8.31(bsdegree) + 1.34(female) + 0.58(age) - 3.73(fem_bsdeg)

(se)      (1.55)   (.227)                       (2.382)                 (0.052)           (0.081)

Iran an OLS regression on a dataset in Stata using the following variables Dependent Variable: Hourly wage in dollars Independent Variables: bs degree Does employee have a bachelor's degree, Yes -1 Gender of employee. Female 1 gender age l Age in years Reg hourly age badegree female age Number of obs Source I 7,440 SS MS F (3, 7436 544 49 Model 15300 4.257 3 51001 4191 Prob F 0.0000 Residual 696510 436 93 6673917 R-squared. 0.1801 Adj R-squared 0.1798 Total 849514 982 7,439 114.19747 Root MSE 9.6782 Std Err Coef P> lt l 195 Conf Interval, hourly wage gree 8.318628 36.58 0.00 7.872889 8.764367 227385 4.260382 female -3.810305 2295979 16.60 3.360228 4328144 0395206 510286 12.91 5877576 age 1.866198 1.187604 cons I 4618427 4.194238 1.57 0.116 5. Interpret the coefficients for statistically significant variables. Be precise. Do not use the word "units" 6. I wanted to know if there is a differential effect on hourly wage of having a bachelor's degree for females vs males. My estimated equation follows: (HINT Don't forget about the intercept)

Explanation / Answer

Answer to question# 5)

The significant variables are the one's who got P value < 0.05

So the interpretation is as follows:

bsdegree: the coefficient is 8.3186

This is a positive coefficient , which implies that with one unit increase in bsdegree the hourlywage would increase by 8.3186 times

.

Female: the coefficient is -3.8103

This is a negative coefficient , which implies that if the number of females increases,the hourly wages decrease

Thus if there is one unit increase in females, the hourly wage will decrease 3.8103 times., which is a drastic decrease.

.

the third variable is age, with a coefficient of 0.5103

It is a positive coefficient , indicating positve relation , as the age increases , hourlywage also increases

Thus if the age increases by 1 unit , the hourly wage increases 0.5103 times. this increase is less as compared to th changes we observed in the previous variables

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