HOMEWORK WEEK 2

1.5
You have collected data on wage and education as follows:
Obs

wage
3.1 3.2 3
educati
on
11 12 11
i.

6 5.3 8.8 11

9 10 11 12 13

5 3.6 18 6.3 8.1 8.8

8 12 16 18 12 12 17 16 13 12

iii.

Use hand calculator to obtain the following statistics value:

+Mean
+Median
+Variance
+Standard deviation
+Covariance
+Correlation coefficient
(hints:
Use Stata program to obtain the following statistics value:
+Mean
+Median
+Variance
+Standard deviation
+Covariance
+Correlation coefficient
+skewness
+kurtosis
Use Stata commands to calculate the number of people having education greater

iv.

than 10
Use Stata commands to generate a variable learningpassion of those having

v.

education greater than 10

Save all the results in a file onepointfive.txt

ii.

1.6
A justification for job training programs is that they improve worker productivity. Suppose
that you are asked to evaluate whether more job training makes workers more productive.

However, rather than having data on individual workers, you have access to data on
manufacturing firms in Ohio. In particular, for each firm, you have information on hours of
job training per worker (training) and number of nondefective items produced per worker
hour (output).
i

Carefully state the ceteris paribus thought experiment underlying this policy question.

i.

Does it seem likely that a firms decision to train its workers will be independent of
worker characteristics? What are some of those measurable and unmeasurable
worker characteristics?

ii.

Name a factor other than worker characteristics that can affect worker productivity.

iii.

If you find a positive correlation between output and training, would you have
convincingly established that job training makes workers more productive? Explain.

1.7
Use the Stata commands on the data in BWGHT.dta to answer this
question.
ii

How many women are in the sample, and how many report smoking during
pregnancy?

iii

What is the average number of cigarettes smoked per day? Is the average a good
measure of the typical woman in this case? Explain.

iv

Among women who smoked during pregnancy, what is the average number of
cigarettes smoked per day? How does this compare with your answer from part (ii),
and why?

Find the average of fatheduc in the sample. Why are only 1,192 observations used to
compute this average?

vi

Report the average family income and its standard deviation in dollars.

vii

Save all the results in a file onepointseven.txt

1.8
Use the Stata commands on the data in MEAP01.dta for the state of Michigan in the year
2001. Use these data to answer the following questions.
i.

Find the largest and smallest values of math4. Does the range make sense?

ii.

Explain.
How many schools have a perfect pass rate on the math test? What percentage is

iii.
iv.

this of the total sample?

How many schools have math pass rates of exactly 50 percent?
Compare the average pass rates for the math and reading scores. Which test is

v.
vi.

harder to pass?
Find the correlation between math4 and read4. What do you conclude?
The variable exppp is expenditure per pupil. Find the average of exppp along with
its standard deviation. Would you say there is wide variation in per pupil

vii.

spending?
Suppose School A spends $6,000 per student and School B spends $5,500 per
student. By what percentage does School As spending exceed School Bs?

viii.

Compare this to 100 [log(6,000) log(5,500)]

Save all the results in a file onepointeight.txt

1.9
Use the Stata commands on the data in JTRAIN2.dta from a job training experiment
conducted for lowincome men during 19761977.
i.

Use the indicator variable train to determine the fraction of men receiving job

ii.

training.
The variable re78 is earnings from 1978, measured in thousands of 1982 dollars.
Find the averages of re78 for the sample of men receiving job training and the

iii.

sample not receiving job training. Is the difference economically large?

The variable unem78 is an indicator of whether a man is unemployed or not in
1978. What fraction of the men who received job training are unemployed? What

iv.

about for men who did not receive job training? Comment on the difference.
From parts (ii) and (iii), does it appear that the job training program was

v.

effective? What would make our conclusions more convincing?

Save all the results in a file onepointnine.txt