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Estimate the model by OLS to find the impacts of anti-smoking campaigns

INSTRUCTIONS TO CANDIDATES
ANSWER ALL QUESTIONS

 

In table 1, you are given the data on the demand for cigarettes in Turkey and its determinants for the 29 years (1960-1988). The definitions of the variables are as fallows:

Q = Cigarette consumption per adult (kg)

Y = Per-capita real GNP in 1968 prices in Turkish liras.

P = Real price of cigarettes in Turkish liras per kg.

ED1 = Ratio of enrollments in middle and high schools to the     

            population 12-17 years old.

ED1 = Ratio of enrollments in universities to the population 20-24 years  

           old.

D82 = 1 for 1982 and onward

D86 = 1 for 1986 and onward

In late 1981, health warnings were issued in Turkey regarding the hazards of cigarette smoking. In 1986 one of the national newspapers launched an antismoking campaign. 

a. Estimate the model by OLS to find the impacts of anti-smoking campaigns 

b. Use the data to transform to logarithm form (LQ = lnQ etc.). 

c. Write down your model without using dummy variables and estimate it by OLS. Interpret your results.

d. Estimate the model by OLS by using dummy variables and interpret your results.

 

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