2. [10 points in total; 2.5 pts. each.] Suppose that State Z introduced a public program...

 

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2. [10 points in total; 2.5 pts. each.] Suppose that State Z introduced a public program in 2016 to improve the labor market conditions, specifically the labor supply in terms of number of hours worked within the State. As a Special Economic Advisor to the State Governor, you have been assigned the task of evaluating the program. Specifically, the Governor is interested in evidence about whether this program has led to effective increases in labor supply (as defined earlier) within the state. You observe the following information: Year Year 2011 2013 2015 2017 A. Using the appropriate approach, as discussed in class, what do think is a better you estimator to evaluate this program and what the best estimate is? 2011 2013 2015 2017 Number of hours worked in State Z (in millions) 600 620 640 700 B. Suppose that you find information on the neighboring State, W, that did not put in place any program to improve the labor market conditions during the same time period. You observe the following information in that state: Number of hours worked in State W (in millions) 560 580 600 640 Based on this additional information, what is your best estimate of the effect of the program on the labor supply? 2. [10 points in total; 2.5 pts. each.] Suppose that State Z introduced a public program in 2016 to improve the labor market conditions, specifically the labor supply in terms of number of hours worked within the State. As a Special Economic Advisor to the State Governor, you have been assigned the task of evaluating the program. Specifically, the Governor is interested in evidence about whether this program has led to effective increases in labor supply (as defined earlier) within the state. You observe the following information: Year Year 2011 2013 2015 2017 A. Using the appropriate approach, as discussed in class, what do think is a better you estimator to evaluate this program and what the best estimate is? 2011 2013 2015 2017 Number of hours worked in State Z (in millions) 600 620 640 700 B. Suppose that you find information on the neighboring State, W, that did not put in place any program to improve the labor market conditions during the same time period. You observe the following information in that state: Number of hours worked in State W (in millions) 560 580 600 640 Based on this additional information, what is your best estimate of the effect of the program on the labor supply?

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