Students individually are required to write a 1500 word research project.  Students should choose only one of eleven projects. The research project counts for 30% of the final grade.

Project One



For Project One you need to use the Stata dataset project1.dta. The data is from the last four waves of the British Household Panel Survey: wave 15, 16, 17 and 18.  The description of the variables is listed in Table One:


Table One


Variable Variable Name Description of the Variable
Personal identification number pid Identification used to identify individuals in the data
Wave number wave 15, 16, 17 and 18
Household identification number hid Identification used to identify households in the data
Number of children in the household nkids Ranges from 0 to 6 where 0 means no child and 6 implies 6 children
Real (1987=100) annual household income rfihhyr In real GBP
Sex of the respondent female female =1 , male =0
Change in financial situation compared to last year fisitcd1, fisitcd2, fisitcd3 fisitcd1: better, fisitcd2: worse
fisitcd3: same; denoted as dummy variables

Expectation about the financial situation for a year ahead fisitxd1, fisitxd2, fisitxd3 fisitxd1: better, fisitxd2: worse
fisitxd3: same; denoted as dummy variables

Whether the respondent saves from current income

save

Save: 1 = yes, 0 = no

Marital status mastatd1,mastatd2,
mastatd3,mastatd4,

mastatd5,mastatd6

mastatd1: Married, mastatd2: Living as Couple, mastatd3: Widowed, mastatd4: Divorced, mastatd5: Separated, mastatd6: Single, each one of them are binary variables denoting the status as stated
Educational status neduc, ueduc, oheduc, aeduc, oeduc, poeduc neduc: 1, no formal educational qualification, ueduc: 1, University degree, oheduc: 1, other higher level qualification (Nursing, Teaching etc.), aeduc: 1, A-level, oeduc:1, GCSE, poeduc: 1, Pre-GCSE, each one of them are binary variables denoting different status as stated
Health status(dependent variable) hlstat 1: poor, 2: medium, 3: good, 4: excellent


a) Estimate an ordered probit model using your chosen satisfaction variable as the dependent variable, where satisfaction depends on number of children in the household, sex of the respondent and real annual household income. Comment on your findings. Calculate the average marginal effect regarding household income and interpret your findings.



b) Now add marital status, educational status, change in financial situation compared to last year (use same as the base category), expectation about the financial situation for a year ahead (use same as the base category) and whether the respondent saves from current income, along with the model specification in part a). Test whether the set of new explanatory variables are jointly significant or not in explaining your satisfaction variable. Comment on your findings. Calculate the average marginal effect for ‘whether the respondent saves from current income’ and interpret your findings.



c) Calculate the average marginal effects with respect to change in financial situation compared to last year and expectation about the financial situation for a year ahead for the model in part b). Comment on your findings.



d) Does the result that you have obtained in part c) alter if you add regional dummies in your model? Comment.

projects should be a maximum of 1,500 words in length excluding the references and tables. You should include your output in the Appendix.



All coursework projects that contribute to the assessment of a module are subject to a word limit, as specified in the online module handbook in the relevant module area of the MINERVA. The word limit is an extremely important aspect of good academic practice, and must be adhered to. Unless stated specifically otherwise in the relevant module handbook, the word count includes EVERYTHING (i.e. all text in the main body of the project including summaries, subtitles, contents pages, tables, supportive material whether in footnotes or in-text references) except the main title, reference list and/or bibliography and any appendices.  It is not acceptable to present matters of substance, which should be included in the main body of the text, in the appendices (“appendix abuse”).  It is not acceptable to attempt to hide words in graphs and diagrams; only text which is strictly necessary should be included in graphs and diagrams.



You are required to adhere to the word limit specified and state an accurate word count on the cover page of your project brief.  Your declared word count must be accurate, and should not mislead. Making a fraudulent statement concerning the work submitted for assessment could be considered academic malpractice and investigated as such.  If the amount of work submitted is higher than that specified by the word limit or that declared on your word count, this may be reflected in the mark awarded and noted through individual feedback given to you.