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EC339: Lecture 4

EC339: Lecture 4. Chapter 3: Pivot Tables or… Conditional Expectations? (a.k.a. Crosstabs). First, get Excel up to speed. Install Necessary Add-ins:

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EC339: Lecture 4

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  1. EC339: Lecture 4 Chapter 3: Pivot Tables or… Conditional Expectations? (a.k.a. Crosstabs)

  2. First, get Excel up to speed • Install Necessary Add-ins: • Execute Tools: Add-ins (to get the Add-Ins Manager dialog box, as shown to the right) and check the Analysis ToolPak and Analysis ToolPak VBA options. • Now is also a good time to install the Histogram add-in. Once again, execute Tools: Add-ins and click Browse. Navigate to the Histogram.xla file and click OK.

  3. Open IndianaFTWorkers.xls • Look in Basic Tools\Internet\CPS folder • Try to find out if wage discrimination is prevalent in the state of Indiana • Start by summarizing data • Descriptive Statistics: see DescStat • Use “Decriptive Statistics” for numeric variables • Use “PivotTable” for categorical variables

  4. Univariate Statistics • Histogram • Try using built-in Excel Histogram function • Also use BH Histogram function • See my website or BH for Excel Macros • You must reinstall these each time you use them on campus computers that are not your own • “Frequency Tables” are done using PivotTable and Descriptive Statistics

  5. Multivariate Statistics • Crosstabs • Display relationships and patterns between multiple variables. • Display the value of one or more variables conditional on the value of one or more other variables • Excel allows for ‘grouping’

  6. Crosstabs • Education and Income • Race and Income • Sex and Income • Race and Education • Sex and Education

  7. Examples of Conditional Averages From Indiana Note here there is an example of a weighted average. The overall average of $37,174 is the average of the individuals (or weighted by observations here), rather than the average of the averages, which would be $65,901. See WeightAvg sheet

  8. Crosstab of Income by Race and Education Given you are black and have a high school diploma, the expected value or average income would be $27,700. If you are black, and have some college, the expected value of income rises to $33,268, a difference of $5,568. Note, the difference for a white HS grad and some college is $5,840

  9. Conditional Mean Function • Using EastNorthCentralFTWorkers.xls • Conditional Mean: the average (mean) of y given x. Often written in expectations form E(y|x). The vertical line signifies given or conditional. • Group Annual Earnings by Education • What is average annual income of individuals with 12 years of education? • What about if you know their income is between $20,000 and $39,999?

  10. SPSS Example • First step, get data into SPSS • To make similar tables in SPSS, use AnalyzeCompare Means • Put the variable you want to summarize (annual income here) as dependent, and put the different variables you want in the x-tab as two separate layers.

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