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15. Treatment effects without randomization Suppose you want to evaluate the effectiveness of a job training program using wage =0+1 program +u as a model. You take 800 employees and estimate the simple regression as: wage=12.33.3program where wage = hourly wage in dollars program =1 if the employee participated in the training course, 0 otherwise Suppose that in addition to performing the simple regression, you perform a multiple regression with three controls that gives the following result: wage=10+2program+0.9prevearn+1.2educ0.95age where wage = hourly wage in dollars program =1 if the employee participated in the training course, 0 otherwise educ= years of education age = age in years The difference between wage and wage of an employee who participated in the training program is per hour. (Hint: Calculate wage - wge holding prevearn, educ, and age constant when computing wge.) The difference between wage and wage of an employee who did not participate in the training program is per hour. (Hint: Calculate wage wage holding prevearn, educ, and age constant when computing wge.) True or False: In the simple regression model, wage=12.33.3 program, the negative sign on program is likely a result of nonrandom selection into the training program. True False 15. Treatment effects without randomization Suppose you want to evaluate the effectiveness of a job training program using wage =0+1 program +u as a model. You take 800 employees and estimate the simple regression as: wage=12.33.3program where wage = hourly wage in dollars program =1 if the employee participated in the training course, 0 otherwise Suppose that in addition to performing the simple regression, you perform a multiple regression with three controls that gives the following result: wage=10+2program+0.9prevearn+1.2educ0.95age where wage = hourly wage in dollars program =1 if the employee participated in the training course, 0 otherwise educ= years of education age = age in years The difference between wage and wage of an employee who participated in the training program is per hour. (Hint: Calculate wage - wge holding prevearn, educ, and age constant when computing wge.) The difference between wage and wage of an employee who did not participate in the training program is per hour. (Hint: Calculate wage wage holding prevearn, educ, and age constant when computing wge.) True or False: In the simple regression model, wage=12.33.3 program, the negative sign on program is likely a result of nonrandom selection into the training program. True False

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