Watch the video named “Queens and Lessons on Female Leadership” from the great Econimate, and answer the following questions:

a. What is the main causal question of interest? And what would a simple difference in groups be measuring?

(In b to e you are asked to use the OVB formula to describe the identification problem in this case)

b. Write down a regression equation that would estimate the simple difference in groups and label it the short equation.

c. Think of an omitted variable that could be affecting beta_s and write down the long equation (tip: here you have to speculate about a variable that you don’t have, so to make it concrete, think of the omitted factor and then turn it into some type of score. For example, in a different analysis we could suspect that motivation is an omitted factor. To study its effect on the OVB formula, we just assume that we have something like a motivation score where 0 is the least and 100 is the most motivated that an individual can be).

d. Write down the auxiliary equation

e. Discuss the OVB formula in this case (again, both sides of the equation)

f. Describe one of the instruments that are used in the IV approach. Define the variable.

g. Write down the first stage equation for this IV.

h. Describe the exclusion restriction in this case.