Question

Suppose you decide to build a model to explain why the average worker in a particular occupation works more hours during some weeks than during others.

What data would you collect to describe this phenomenon?

What variable do you believe would supply the major part of the explanation of the variation in hours worked?

If you graph the data with hours worked on the vertical axis and your explanatory variable on the horizontal axis, will the relationship be upward-sloping or downward-sloping?

What does your answer to part c imply for whether the data on hours worked and the data on your explanatory variable are positively or negatively correlated?

Answer 1

We would collect data on work hours per week in many years to see whether the trend is similar in many years so that we can generalise. I. E draw conclusions. We would collect data also on wage rate and holidays.

I think it might be overtime wage rate and economic situation(depression, boom etc) if we control for holidays. We also assume wage rate varies positively with booms and negatively with depressions so that only wage rate could be used as explanatory variable. If holidays are not controlled then they will give wrong conclusions

It will be upward sloping

They are positively correlated