SS154 HW 2

/* Q1 */

/* Data cleaning */

egen P = anymatch(personid), values (1 2 3 4 5 6 7 8 9 10 11 12 13 14 15) /*gives a 1 value to all people from 1 to 15 */
keep if P /* leave the 15 perople only */
drop P

gen P = 0
bysort personid (personid): replace P= 1 if _n == 1 /*assigns a one for the 
first observation of every person */
keep if P == 1 /* just grabs the first one */
drop P

/* generate the lists for x1 and x2*/
global x1 educ potexper ability 
global x2 mothered fathered siblings
global y logwage

/*a */
regress $y $x1
*b*
regress $y $x1 $x2 


/*c*/
regress $y $x1 $x2
regress $y $x1 $x2, noconstant
/*Get R^2 by doing 1 - (SSE/SST)*/

/*d*/
regress $y $x1 $x2, 
regress $y $x1 $x2, noconstant
/* Get adjusted by doing 1 - (SSE/(N-K)/SST/(N-1))*/


*e*
/* 
MR 1 - Variables explain y 
MR 2 - assumption 2 leads to believe errors are distributed arround 0

*/

/*MR 5*/
corr $y $x1 /*get the correlations between variables, comment on high values */
corr $y $x1 $x2

/*MR 6, Make use of histograms of the residuals with a fitted normal distribution to see the fit*/
regress $y $x1
predict r, resid
hist r, freq normal

regress $y $x1 $x2
predict r2, resid
hist r2, freq normal

/* Q2 */

gen quant_pc = gasexp/(gasp*pop)


/*a*/
regress quant_pc income puc ps ppt pnc pn pd gasp year


/* b
test of hypothesis*/
regress gasexp pnc puc
test _b[pnc] == _b[puc] /* Fail to reject null --> not stat sig diff from each other*/


/*c*/
quietly regress quant_pc income puc ps ppt pnc pn pd gasp year
margins, eyex(gasp) at(year==2004)
margins, eyex(income) at(year==2004)
margins, eyex(ppt) at(year==2004)


/*d*/
gen lnquant_pc = ln(quant_pc)
gen lnincome = ln(income)
gen lnpuc = ln(puc)
gen lnps =ln(ps)
gen lnppt =ln(ppt)
gen lnpnc =ln(pnc)
gen lnpn =ln(pn)
gen lnpd =ln(pd)
gen lngasp=ln(gasp)

regress lnquant_pc lnincome lnpuc lnps lnppt lnpnc lnpn lnpd lngasp year
/*compare values of margins to the log log model*/

/*e*/
corr puc ps ppt pnc pn pd gasp
corr lnpuc lnps lnppt lnpnc lnpn lnpd lngasp

/*f*/
/*Normalize into 2004 */
gen ngasp = gasp * 100/gasp[52]
gen npnc = pnc * 100/pnc[52]
gen npuc = puc * 100/puc[52]
gen nppt = ppt * 100/ppt[52]
gen npd = pd * 100/pd[52]
gen npn = pn * 100/pn[52]
gen nps = ps * 100/ps[52]

regress quant_pc ngasp npnc npuc nppt npd npn nps income year

/*Do the same for the logs */
gen lnngasp = ln(ngasp)
gen lnnpnc = ln(npnc)
gen lnnpuc = ln(npuc)
gen lnnppt = ln(nppt)
gen lnnpd = ln(npd)
gen lnnpn = ln(npn)
gen lnnps = ln(nps)

regress lnquant_pc lnngasp lnnpnc lnnpuc lnnppt lnnpd lnnpn lnnps lnincome year