Explore BrainMass
Share

Explore BrainMass

    Salary and Gender - Testing for Discrimination

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Salary and Gender - Testing for Discrimination
    The starting salary (Y) is related to years of education (X), previous work experience (E) and hiring time (T) for 93 employees of a bank. Suppose that you have been hired by a government agency to investigate whether there has been any salary discrimination on the basis of gender.
    (See attachments for full question)

    © BrainMass Inc. brainmass.com October 9, 2019, 4:32 pm ad1c9bdddf
    https://brainmass.com/economics/regression/salary-and-gender-testing-for-discrimination-35268

    Attachments

    Solution Preview

    Salary and Gender - Testing for Discrimination
    The starting salary (Y) is related to years of education (X), previous work experience (E) and hiring time (T) for 93 employees of a bank. Suppose that you have been hired by a government agency to investigate whether there has been any salary discrimination on the basis of gender.
    In the attached excel file the first 61 observations are for female employees and the last 32 observations are for male employees. Let Gt be a gender dummy variable that is equal to 1 for the males and 0 for the females.
    (a) Estimate the model Yt = β1 + δGt + et .
      Coefficients SE t Stat P-value
    Intercept 5,138.852 76.255 67.390 0.000
    G 818.023 129.997 6.293 0.000
    From the OLS report in EXCEL, we can write the model into:
    Yt = 5,138.852 + 818.023 Gt + et .
    (1) How would you test whether male salaries are ...

    Solution Summary

    Dummy Variable Analysis is demonstrated.

    $2.19