library(AER)
data(mroz, package=’wooldridge’)
oursample <- subset(mroz,!is.na(wage))
HR0 <- lm(hours~log(wage)+educ+age+kidslt6+nwifeinc, data=oursample)
Wage0 <- lm(log(wage)~hours+educ+exper+I(exper^2), data=oursample)
# 2SLS regressions
HR <- ivreg(hours~log(wage)+educ+age+kidslt6+nwifeinc
|educ+age+kidslt6+nwifeinc+exper+I(exper^2), data=oursample)
Wage <- ivreg(log(wage)~hours+educ+exper+I(exper^2)
|educ+age+kidslt6+nwifeinc+exper+I(exper^2), data=oursample)
library(systemfit)
# Define system of equations and instruments
eq.hrs <- hours ~ log(wage)+educ+age+kidslt6+nwifeinc
eq.wage <- log(wage)~ hours +educ+exper+I(exper^2)
eq.system<- list(eq.hrs, eq.wage)
instrum <- ~educ+age+kidslt6+nwifeinc+exper+I(exper^2)
# 2SLS of whole system (run Example-16-5-systemfit-prep.R first!)
SEM <- systemfit(eq.system,inst=instrum,data=oursample,method=”2SLS”)
library(stargazer)
stargazer(HR0,Wage0,HR,Wage,type=”text”,keep.stat=c(“n”,”rsq”))
summary(SEM)
WEEK15