If the estimates of the coefficients of interest change substantially across specifications,
A) then this can be expected from sample variation.
B) then you should change the scale of the variables to make the changes appear to be smaller.
C) then this often provides evidence that the original specification had omitted variable bias.
D) then choose the specification for which your coefficient of interest is most significant.
Answer: C
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The difference between a monopsonist's marginal expenditure and that of a price taker is:
A. the marginal cost of the input. B. the input expansion effect. C. the price increase effect. D. the marginal substitution effect.
Producers of computer software are plagued with the problem of “pirating,” that is, many people copy software legally purchased by others. The industry estimates that for each legal copy of a program, there are two pirated copies in use. The industry wants strict laws for the enforcement of its “intellectual property rights,” but enforcement is obviously very difficult. Economists call this problem
A. depletability. B. externality. C. durability. D. nonexcludability.
A monopolist will not change its current behavior
A. unless demand is greater than marginal revenue. B. unless it earns positive economic profits in the long run. C. even if total revenue does not cover variable costs. D. if it earns positive economic profits in the long run.
How would an increase in the U.S. federal budget deficit affect the exchange rate in the market for dollars?
A) The exchange rate will increase. B) The exchange rate will not be affected by a change in the federal budget deficit. C) The exchange rate will decrease. D) The impact of the increase in the federal budget deficit on the exchange rate cannot be predicted.