联系我们： 手动添加方式: 微信>添加朋友>企业微信联系人>13262280223 或者 QQ: 1483266981

ECOS3035: Economics of Political Institutions Homework III Question 1 [35 marks in total]: Academic researcher A is interested in identifying the causal impact of politicians’ reputation on the Republican vote share, at the county-level, during the 2024 US Presidential Election. She is currently gathering data and brainstorm- ing on a potential identification strategy. She needs your help with the following questions. 1. What is the simplest form of the Ordinary Least Squares (OLS) equation that she can use as a starting point of her econometric analysis. Use Y to denote the dependent variable, X to denote the treatment variable and β to denote the coefficient of interest, and ε to denote the error term. [3 marks] 2. Within this OLS specification, explain whether politicians’ reputation will assume the position of X or Y. Why What is the position of the Republican vote share Why [4 marks] 3. Within this specification, what does the coefficient of interest β represent [2 marks] 4. List the two major empirical challenges that restrict the researcher from causally interpreting the coefficient of interest β and explain what they mean. [8 marks] 5. A colleague suggests using “Instrumental Variables (IV)” to address concerns on causality. Explain to Researcher A what this method is, and the conditions that should be satisfied for the effective use of this method. [8 marks] 6. Researcher A has access to a dataset on a media campaign which propagated fake negative news on politicians during the election. This campaign was randomly de- ployed across counties, i.e. some counties were exposed to this campaign while others were not. Can she use this dataset to construct a valid IV for this project Why or why not [10 marks] – END OF HOMEWORK –