In an effort to determine whether going to class improved st

In an effort to determine whether going to class improved student academic performance, David Romer[1] developed the following equation:

Where: G_i = the grade of the ith student in Romer’s class (A=4, B=3, etc).

                ATT_i = the percent of class lectures that the ith student attended

                PS_i = the percent of the problem sets that the ith student completed

What signs do you expect for the coefficients of the independent variables in this equation?Explain your reasoning.

Romer then estimated the equation:

Do the estimated results agree with your expectations?

It’s usually easier to develop expectations about the signs of coefficients than about the size of those coefficients.To get an insight into the size of the coefficients, let’s assume that there are 25 hours of lectures in a semester and that it takes the average student approximately 50 hours to complete all of the problem sets in a semester.If a student in one of Romer’s classes had only one more hour to devote to class and wanted to maximize the impact on his or her grade, should the student go to class for an extra hour or work on problem sets for an extra hour?(HINT:Convert the extra hour to percentage terms and then multiply those percentages by the estimated coefficients.)

From the given information, it would be easy to draw the conclusion that the bigger a variable’s

[1] Romer, David. (1993). Do Students Go to Class? Should They? Journal of Economic Perspectives 7(3): 167-74.

Solution