Dropout equation - unemployment variable, Econometrics

Assignment Help:

Consider the following equations designed to estimate  a school's test scores (Test) and the school's dropout rate (Drop).

Testi = B0 + B1*Parent Edi + B2*school qualityi + B3*Dropi + Ei

Dropi = a0 + a1*Parent Edi + a2*school qualityi + a3*Testi + Vi

a. Use the order condition to determine if these equations are exactly identified, under-identified, or over-identified (the intuitive version is fine).

b. Suppose another variable (teenage unemployment) is available and is thought to affect dropout rates but not test scores. How will your answer to part (a) change if this unemployment variable is included in the dropout equation?

c. Explain intuitively why OLS will be biased if the equations are estimated separately.


Related Discussions:- Dropout equation - unemployment variable

Demand functions for the two products , The  firm  is  considering  manufac...

The  firm  is  considering  manufacturing  a  second  product  in  its  factory alongside the first. The demand functions for the two products are: Q d1 =180 - 4P 1 Q d2 =90

Time series models, analyze the trend of time series using semi-average met...

analyze the trend of time series using semi-average method, method of least square regression and moving average method

Need help with Econometrics Coursework, Hello I am a PostGrad student. Need...

Hello I am a PostGrad student. Need some help in the coursework

Explain regression model, In a study relating college grade point average t...

In a study relating college grade point average to time spent in various activities, students are asked how many hours they spend each week in four activities: studying, sleeping,

The south African government is not providing, Ask question #are there a...

Ask question #are there any welfare or subsidy payment that should be reviewed or added?

Transportation problems, Process of least cost method and how to do a minim...

Process of least cost method and how to do a minimisation problem

Indifference curves, Assume that the allowance Peter receives from parents ...

Assume that the allowance Peter receives from parents is his only income.  He used to spend $30 a month to buy Coke at $.60 per can.  Coke is an inferior good for Peter.  Further a

Ethical problem in dependent variable, The attached Eviews results are for ...

The attached Eviews results are for a model who has a professional career (dependent variable = pro (1 if respondent has a professional career, 0 otherwise). The data is the 1979 c

Stata, Please help me in using Stata

Please help me in using Stata

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd