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The question is: give CI (confidence interval) of the given below case. Explain the breach of exogenity and exclusion restrition. d part is optional. For

The question is: give CI (confidence interval) of the given below case. Explain the breach of exogenity and exclusion restrition. d part is optional. For details please see below:

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5. A recent working paper titled "Urban Density and COVID-lg\" studies the link between population density and COVlD-19 spread and severity in the United States.'1 Historically, cities have been associated with the propagation of infectious diseases. Has density the defining feature of cities - promoted the spread of COVID-19? As the authors point out, estimating how popuiation density shaped the severity of the COVID-19 outbreak is challenging, as population density might be correlated with local economic conditions that affect COVlD-lg incidence. These potentially unobservable factors can confound the effect of density on the spread of the disease. To deal with this problem, they use an instrumental variable (IV) strategy, using the presence of aquifers, earthquake risk, and soil drainage capacity to build an instrument for density. Using this IV strategy, the authors regress the log of deaths per 100.000 inhabitants [after 45 days of the first case) on the log of population density (calculated as the total population per squared mile}, finding an estimate equal to -0.11 (standa rd error=D.15], and conclude that there is no evidence that population density is linked with COVlD-19 incidence. Discuss this estimate in terms of its statistical and economic significance. Please, report also the 95% level confidence interval. (5 marks) Propose some possible violation of the exogeneity assumption. (5 marks) Propose some possible violation of the exclusion restriction. (5 marks) Discuss verbally who are the always-takers, the never-takers, the compliers and defiers. [5 marks}

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