10 Questions Economics

Homework 14

Economics in the Real World:  Experimental Economics and Econometrics

Read the assigned readings to answer the following questions.


Question Points
1 10
2 10
3 10
4 10
5 10
6 10
7 10
8 10
9 10
10 10
Total 100


Question 1

Why do we want to do some experiments in a lab, and what purpose do cash payouts in the lab serve?



Question 2

Why did Vernon Smith setup his experiment and what did he find?



Question 3

In the comparative experiment of attending Duke versus UNC, why do we want a clone?



Question 4

What ways do private university graduates differ from public university graduates, and how does this cause selection bias when we’re trying to determine whether attending private or public university is best?



Question 5

What were the two OVBs that Dale & Krueger controlled for, and how did they control for them?  How much is the wage premium for private university students when we control for the two OVBs?



Question 6

How do RCTs allow us to determine causality?



Question 7

Describe the how the West Point experiment was set up.  What was the result?



Question 8

What is balance, why is it important, and how would you determine whether the Control group and Treatment 1 group are balanced for prior military service covariate using the standard errors?



Question 9

What is the instrumental variables method, and what is the IV chain reaction (the first and second stages) in the KIPP experiment?




Question 10

What is the differences-in-differences methodology, and how did Friedman & Schwartz use DD to determine the impact of Fed policy in Mississippi?