References Mailings Review View ACROBATTell me what you want to do Heading 1 1 N

Question

References Mailings Review View ACROBATTell me what you want to do Heading 1 1 Normal Stron x, x, A.y-A· 1··,11 Emphasis Font Paragraph 2. (50 points) The file "CRIMEA DAT" is posted with this assignment. It has panel data across a group of counties for the years 1981-1987 a. (10 points) Regress Incrmrte) on Ingprbart). In(prbcon), In(prbpris). In(avgsen), and In(polpc) allowing for entity fixed effects and robust standard errors. Do not allow for time period fixed effects. Copy and paste your regression output (8- or 9-point Courier New font) as your answer to this question regress sHREES RERAE x prbexisales, robust Linear regression Number of 630 E5, 624) 12.06 R-squared Root MSE one01514 Robust Std. Err. cast, p-L9SS Conf. Interval] REkat, .0S03475 .0097541-5.160.000 -.0695023-0311927 rbsRnz .00323 0013017 2.48 0.0130057862 .0006739 0368105 000902 4.88 0.0001.839133 4.314562 REtec 1.0239972 .0065248 3.68 0.000 axguea :0003119-0003005 RARG 3.076847 6302739 1.04 0.3000002782 0211804 0395892 cons i 0303848 0046871 6.480.000 b. (15 points) What are the effects of the.sach right-hand-side variable on the crime rate as implied by the regression in part (a)? Answer whether the effect is positive, negative, or zero. Briefly explain your answer for each variable. Prbarr Pbcoav Pibpris Avgsen Polps c. (10 points) Re-estimate the regression from part (a) allowing for both entity. fixed effects and time period fixed effects, again with robust standard errors. Copy and paste your regression output (8- or 9-point Courier New font) as your answer to this question. Fixed-eEfects (within) regression Group variable: county Number of sba Number of groups 630 90 9ha per group:min between 0.1116 overal1 0.1239 7.0 ax

Explanation / Answer

B. Effects of

1. Effect of Prbarr is negative. As the p-value is small, the effect is significant and the sign of coefficient is negative implying that this has negative effect on the response variable

2. Effect of prbcony is negative. As the p-value is small, the effect is significant and the sign of coefficient is negative implying that this has negative effect on the response variable

3. Effect of prboris is Positive. As the p-value is small, the effect is significant and the sign of coefficient is positive implying that this has positive effect on the response variable

4. Effect of aygsen is Zero. As the p-value is large, the effect is not significant.

5. Effect of polpc is Positive. As the p-value is small, the effect is significant and the sign of coefficient is positive implying that this has positive effect on the response variable

D. YES.

The effects of prbarr, prbcony, prbpris are not significant as the p value is large.

aygsen and polpc has significant effect and the effect is positive.

E. The estimated coefficient of ln(polpc) is troubling because of very large estimate of standard error as compared to others.

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