Your textbook discussed the regression model when X is a binary variable
Yi = β0 + β1Di + ui,i = 1... ,n
Let Y represent wages,and let D be one for females,and 0 for males.Using the OLS formula for the slope coefficient,prove that is the difference between the average wage for males and the average wage for females.

Question

Your textbook discussed the regression model when X is a binary variable
Yi = β0 + β1Di + ui,i = 1... ,n
Let Y represent wages,and let D be one for females,and 0 for males.Using the OLS formula for the slope coefficient,prove that  is the difference between the average wage for males and the average wage for females.

Quizplus · Accepted Answer

The Answer of Your textbook discussed the regression model when X is a binary variable
Yi = β0 + β1Di + ui,i = 1... ,n
Let Y represent wages,and let D be one for females,and 0 for males.Using the OLS formula for the slope coefficient,prove that  is the difference between the average wage for males and the average wage for females.

Your Textbook Discussed the Regression Model When X Is a Binary