Mincer wage equation. Using the Cornwell and Rupert (1988) panel data set described in the empirical example
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Mincer wage equation. Using the Cornwell and Rupert (1988) panel data set described in the empirical example in Sect. 7.4 and given on the Springer website as wage.xls, replicate Table 7.6 and the associated test statistics.
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Table 7.6 Hausman and Taylor estimates of a mincer wage equation xthtaylor lwage occ south smsa ind exp exp2 wks ms union fem blk ed, endog (exp exp2 wks ms union ed) . Hausman-Taylor estimation Group variable (i): id Random effects ui i.i.d. lwage | TVexogenous occ -.0207047 south I .0074398 smsa | -.0418334 ind I .0136039 TVendogenous | exp | exp2 | wks | ms | union | TIexogenous 1 Coef. Std. Err. TIendogenous | ed I fem | -.1309236 blk I -.2857479 cons | .1131328 -.0004189 .0008374 -.0298508 .0327714 .137944 2.912726 sigma_u I .94180304 sigma_e I .15180273 rho | .97467788 .0137809 .031955 .0189581 .0152374 .002471 .0000546 .0005997 .0149084 .126659 .1557019 .0212485: Z .2836522 Number of obs Number of groups Obs per group: min = avg = max= Wald chi2 (12) Prob chi2 45.79 0.000 .1082898 -7.67 0.000 -.0005259 1.40 0.163 -.0003381 .01898 -1.57 0.116. -.0670508 2.20 0.028 .0035514 P> |Z| -1.50 0.133 0.23 0.816 -2.21 0.027 0.89 0.372 -1.03 0.301 -1.84 0.066 6.49 0.000 10.27 0.000 -.0477149 -.0551908. -.0789906 -.0162608 [95% Conf. Interval] -.3791707 -.5909179 .0962977 2.356778 4165 595 (fraction of variance due to u_i) note: TV refers to time-varying; TI refers to time-invariant. 7 7 7 6891.87 0.0000 .0063055 .0700705 -.0046761 .0434686 .1179758 -.0003119 .0020129 .0073493 .0619914 .1173234 .0194221 1795902 3.468674
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