Use the data set “card extract.dta” available on Blackboard in the folder “Assignment4.”... 1 answer below »

Use the data set “card extract.dta” available on Blackboard in the folder “Assignment4.”

This data set contains the records of 2,997 individuals observed in 1976. For each individual, you observe several characteristics as of 1976, such as race, age, education, wage,

residence in a Standard Metropolitan Statistical Area (SMSA), residence in the south,

marital status, and enrollment in school. You also observe father’s and mother’s education. Moreover, the data set contains some characteristics as of 1966, when sampled

individuals were likely deciding their education career. Specifically, you observe residence

in SMSA and in the south, as well as proximity to 4-year and 2-year college. Type the

command describe to familiarize yourself with the available variables in this data set.

Run an OLS regression of lwage on the following set of explanatory variables: black,

smsa, south, age, age2

, married and educ (use factor variable notation –i.variable– for

discrete variables). Interpret the estimated coefficient of educ.