You Have Collected Data on Individuals and Their Attributes

question 22

Essay

You have collected data on individuals and their attributes. Consequently you have generated several binary variables, which take on a value of "1" if the individual has that characteristic and are "0" otherwise. One example is the binary variable DMarr which is "1" for married individuals and "0" for non-married variables. If you run the following regression:
ahe_i= β₀ + β₁×educ_i + β₂×DMarr_i + u_i
a. What is the interpretation for β₂?
b. You are interested in directly observing the effect that being non-married ("single")has on earnings, controlling for years of education. Instead of recording all observations such that they are "1" for a not married individual and "0" for a married person, how can you generate such a variable (DSingle)through a simple command in your regression program?

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Definitions:

Printf()

A standard library function in C programming that allows for formatted output to the screen.

Scanf()

A function in C programming used to read formatted input from the standard input (stdin).

Sscanf()

A function in C that reads formatted input from a string, allowing for extracting values according to specified format specifiers.

Sequence of Characters

A contiguous series of characters, typically used to represent text in computing and programming languages.