(A) Interpret every structural parameter in the following regression:

where PROFSAL is the professor’s salary;
EXP is the professor’s experience in years;
DUM = 1 if the professor is male; 0 otherwise.
(B) Draw a diagram reflecting the regression results with PROFSAL on the vertical axis and EXP on the horizontal axis.
(C) What would be the new values of the structural parameters if the dummy was defined as 1 if the professor is nonmale; 0 otherwise?

Transcribed Image Text:

PROFSAL; 16.1718 + 1.2016 EXP + 3.2245 DUM = - 1.0001 DUM * EXP + ei