question archive Econometric Theory Tasks You want to study whether employers discriminate against minorities in their hiring decisions
Econometric Theory Tasks You want to study whether employers discriminate against minorities in their hiring decisions
Subject:BusinessPrice: Bought3
Econometric Theory Tasks
You want to study whether employers discriminate against minorities in their hiring decisions. You have a
data set of people who sent job applications to firms. The dataset contains information on the following:
• interview: whether a person was invited for an interview (i.e. a binary indicator that equals one if a
person applied and was invited for an interview and zero otherwise)
• minority: a person's minority status: a binary indicator that equals one if the person is from an ethnic
minority and zero otherwise
• yrs_educ: a person's years of education (a continuous variable)
• female: whether a person is female or not (also a binary indicator)
question:
3. All you know about the data is that is was collected from a job board (i.e. a website where jobs are
advertised). Discuss the random sampling assumption and the conditional independence assumption (in
the lecture it was E(u|X) = 0). Are these assumptions fulfilled in this case (explain why or why not)?
Explain intuitively the likely consequences of these assumptions (not) being fulfilled for estimating the
effect of interest.
