Question

Let kids denote the number of children ever born to a woman, and let $e d u c$ denote years of education for the woman. A simple model relating fertility to years of education is $$k i d s=\beta_{0}+\beta_{1} e d u c+u,$$ where $u$ is the unobserved error. i. What kinds of factors are contained in $u$ ? Are these likely to be correlated with level of education? ii. Will a simple regression analysis uncover the ceteris paribus effect of education on fertility? Explain.

          Let kids denote the number of children ever born to a woman, and let $e d u c$ denote years of education for the woman. A simple model relating fertility to years of education is
$$k i d s=\beta_{0}+\beta_{1} e d u c+u,$$
where $u$ is the unobserved error.
i. What kinds of factors are contained in $u$ ? Are these likely to be correlated with level of
education?
ii. Will a simple regression analysis uncover the ceteris paribus effect of education on fertility? Explain.

Added by Nicole A.

Principles of Economics

Gregory Mankiw 8th Edition

Instant Answer

Solved by Expert Chai Santi

12/18/2021

Step 1

The factors contained in $u$ are the unobserved factors that affect fertility but are not accounted for in the model. These could include genetic factors, cultural or societal norms, economic factors, health factors, and other individual characteristics. It is Show more…

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Let kids denote the number of children ever born to a woman, and let $e d u c$ denote years of education for the woman. A simple model relating fertility to years of education is $$k i d s=\beta_{0}+\beta_{1} e d u c+u,$$ where $u$ is the unobserved error. i. What kinds of factors are contained in $u$ ? Are these likely to be correlated with level of education? ii. Will a simple regression analysis uncover the ceteris paribus effect of education on fertility? Explain.