In the determining function for Labor productivity given by Labor Prod_i = α₀ + α₁Age_i + α₂Education_i + U_i, what is the role of U_i? A) Factors other than age and education that affect labor productivity B) Factors correlated with age but not education, and do not impact labor productivity C) Factors uncorrelated with age and education, and do not impact labor productivity D) The joint impact of age and education on labor productivity

Question

Quizplus · Accepted Answer

U_i represents factors other than age and education that affect labor productivity.

In the Determining Function for Labor Productivity Given by Labor