Introductory Econometrics: A Modern Approach 6th Edition by Jeffrey M Wooldridge

Exercise 17

The following equations were estimated using the data in BWGHT.RAW:

The variables are defined as in Example 4.9, but we have added a dummy variable for whether the child is male and a dummy variable indicating whether the child is classified as white.

(i) In the first equation, interpret the coefficient on the variable cigs. In particular, what is the effect on birth weight from smoking 10 more cigarettes per day?

(ii) How much more is a white child predicted to weigh than a nonwhite child, holding the other factors in the first equation fixed? Is the difference statistically significant?

(iii) Comment on the estimated effect and statistical significance of motheduc.

(iv) From the given information, why are you unable to compute the F statistic for joint significance of motheduc and fatheduc? What would you have to do to compute the F statistic?

Step 1 of 4

i.

The regression equation is in the form of log-linear, so its coefficient estimate will be measured in percentage change.

The variable cigs is consumption of cigarettes. If cigs increases by 10 per day, then the effect on birth weight is calculated as follows,

Hence, the increase in cigs by 10 per day will result in 4.4% lower birth weight.