Outcomes of Course

Econ 29000

Kevin R Foster, CCNY

Spring 2011

Students will be able to apply mathematically rigorous analysis to topics such as analyzing data tables, hypothesis testing, and regression analysis.

Students can expect to learn topics in four basic areas:

1. creating and interpreting basic statistics on large datasets

o mean

o median

o measures of spread

2. creating and interpreting data tabulations including

o crosstabs of counts and fractions

o marginal and conditional probabilities

o conditional means

3. conducting hypothesis tests for equality of two means and regression t-tests including

o calculating areas under t and normal distributions; calculating t-value

o getting critical values

o creating confidence intervals

o determining p-values

o explaining significance test results including Type I/Type II error

4. determining regression coefficients using statistical software such as SPSS

o explaining the coefficient estimates as slope values

o testing statistical significance of these estimates

o with datasets with thousands of observations

Examples:

Topic Area 2

Using ATUS data from 2003-2009, we look at the crosstabs of race and ethnicity; this gives the number of each group:

	Native American Indian / Inuit / Hawaiian	Asian	African-American	White	Total
Non-Hispanic	1440	2834	12385	69721	86380
Hispanic	325	77	337	11659	12398
Total	1765	2911	12722	81380	98778

The fractions of each demographic category are:

	Native American Indian / Inuit / Hawaiian	Asian	African-American	White	Total
Non-Hispanic	0.014578145	0.0286906	0.1253822	0.7058353	0.8744862
Hispanic	0.003290206	0.0007795	0.0034117	0.1180324	0.1255138
Total	0.017868351	0.0294701	0.1287939	0.8238677

Conditional by row:

	Native American Indian / Inuit / Hawaiian	Asian	African-American	White
Non-Hispanic	0.016670526	0.0328085	0.1433781	0.8071429
Hispanic	0.026213905	0.0062107	0.0271818	0.9403936

So 14% of non-Hispanics are African-American while just 2.7% of Hispanics are African-American.

Conditional by column:

	Native American Indian / Inuit / Hawaiian	Asian	African-American	White
Non-Hispanic	0.815864023	0.9735486	0.9735105	0.8567338
Hispanic	0.184135977	0.0264514	0.0264895	0.1432662

Alternately, 97% of African-Americans are not Hispanic while just 86% of whites are not Hispanic. Native Americans are the most Hispanic ethnic group.

Topic Areas 1 & 4

Using 2010 CPS data, restrict to only fulltime workers with a non-zero wage. Regression will have earnings (annual wage and salary) as the dependent variable.

The first set of basic explanatory variables is hypothesized to be factors such as age, sex, education, race/ethnicity, marital status, veteran status, and if a union member.

Average values of regression variables, for this subset, are:

Wage/Salary (annual)		$ 49,773.79
Age		41.88
Female		44.5%
White		79.7%
African-American		11.8%
Asian-American		5.8%
Native American/ Indian/ Alaskan/ Inuit/ Hawaiian		2.8%
Hispanic		16.1%
	Mexican	9.8%
	Puerto Rican	1.4%
	Cuban	0.6%
Immigrant		17.5%
1 or more Parents were immigrants		23.8%
Education: no high school		8.6%
Education: High School Diploma		28.9%
Education: Some College (incl no degree or Assoc degree)		27.9%
Education: Some College but no degree		17.5%
Education: Associate in vocational		5.0%
Education: Associate in academic		5.4%
Education: 4-yr degree		22.5%
Education: Advanced Degree		12.1%
Married		62.0%
Divorced or Widowed or Separated		14.8%
Unmarried		23.2%
Union member		2.2%
Veteran (any)		7.4%

The regression estimates are made with three basic specifications: Spec 1 has just the listed variables; Spec 2 included dummies for industry, occupation, and state of residence; Spec 3 has dummy interactions for female*age, African-American*age, female*African-American*age, Hispanic*age, female*Hispanic*age, and female*education. An asterisk indicates statistical significance.

	Spec 1		Spec 2		Spec 3
	Coefficient std. error		Coefficient std. error		Coefficient std. error
intercept	-$28,685.56	*	$13,744.52	*	-$10,978.43	*
	1954.106		3025.180		3685.959
Age	$2,517.92	*	$2,012.04	*	$3,052.09	*
	93.814		88.514		133.158
Age-squared	-$23.60	*	-$18.55	*	-$29.40	*
	1.055		.994		1.504
Female	-$17,380.74	*	-$14,587.20	*	$26,912.27	*
	360.019		393.294		4202.955
African American	-$6,136.77	*	-$5,315.62	*	$17,924.27	*
	552.138		545.564		7559.610
Asian	-$783.89		-$3,140.09	*	-$3,196.33	*
	861.879		851.007		849.324
Native American Indian or Alaskan or Hawaiian	-$4,615.72	*	-$3,077.92	*	-$3,030.05	*
	1054.697		1025.422		1022.749
Hispanic	-$5,176.56	*	-$4,433.05	*	$32,492.36	*
	596.068		588.188		5715.141
Immigrant	-$7,377.88	*	-$4,669.63	*	-$4,080.20	*
	776.395		731.493		733.482
1 or more parents were immigrants	$4,513.48	*	$1,231.87		$892.78
	718.087		677.532		677.771
Education: High School Diploma	$7,658.27	*	$3,819.68	*	$4,208.53	*
	701.918		667.305		826.691
Education: Some College but no degree	$15,430.94	*	$7,791.73	*	$9,434.14	*
	756.430		734.022		900.898
Education: Associate in vocational	$15,719.42	*	$8,376.06	*	$9,873.19	*
	1003.190		966.454		1098.448
Education: Associate in academic	$19,907.99	*	$9,660.31	*	$11,310.63	*
	978.304		948.764		1091.644
Education: 4-yr degree	$35,565.50	*	$20,756.84	*	$24,651.87	*
	738.325		761.377		949.760
Education: Advanced Degree	$63,729.94	*	$40,911.95	*	$46,708.57	*
	815.818		896.308		1109.431
Married	$8,100.77	*	$7,074.38	*	$6,912.90	*
	486.083		459.856		459.565
Divorced or Widowed or Separated	$1,646.98	*	$1,893.12	*	$1,881.97	*
	633.993		595.046		594.911
Union member	-$3,992.75	*	$2,282.96	*	$2,372.64	*
	1169.615		1108.181		1105.552
Veteran (any)	-$1,186.63		-$884.41		-$905.22
	687.786		648.453		659.002
R-squared	0.213		0.315		0.319

Sample age-wage profiles are shown below, for a white male with just a high-school diploma, unmarried, neither immigrant, veteran nor union member. The estimated peak earning year is 53 in Specification 1, 54 in Specification 2, and 52 in Specification 3.