Use the data in FRINGE.RAW for this exercise.
(i) For what percentage of the workers in the sample is pension equal to zero? What is the range of pension for workers with nonzero pension benefits? Why is a Tobit model appropriate for modeling pension?
(ii) Estimate a Tobit model explaining pension in terms of exper, age, tenure, educ, depends, married, white, and male. Do whites and males have statistically significant higher expected pension benefits?
(iii) Use the results from part (ii) to estimate the difference in expected pension benefits for a white male and a nonwhite female, both of whom are 35 years old, are single with no dependents, have 16 years of education, and have 10 years of experience.
(iv) Add union to the Tobit model and comment on its significance.
(v) Apply the Tobit model from part (iv) but with peratio, the pension-earnings ratio, as the dependent variable.