Estimate the Cobb-Douglas production function α
Test whether the coefficients of capital and labor are statistically significant.
Determine the percentage of the variation in output that is explained by the regression equation.
Determine the labor and capital estimated parameters and give an economic interpretation of each value.
CANS/CAPITA/YR 6-PACK INCOME MEAN TEMP. Alabama 200 2.19 $/CAPITA (F) Arizona 150 1.99 13 66 Arkansas 237 1.93 17 62 California 135 2.59 11 63 Colorado 121 2.29 19 56 Connecticu1 118 2.49 27 52 Delaware 217 1.99 28 50 Florida 242 2.29 18 52 Georgia 295 1.89 14 72 Idaho 85 2.39 16 64 Illinois 114 2.35 24 46 Indiana 184 2.19 20 52 lowa 104 2.21 16 52 Kansas 143 2.17 17 50 Kentucky 230 2.05 13 56 Louisiana 269 1.97 15 56 Maine 111 2.19 16 69 Maryland 217 2.11 21 41 assachuset 114 2.29 22 54 Michigan 108 2.25 21 47 Minnesota 108 2.31 18 47 Mississippi 248 1.98 10 41 Missouri 203 1.94 19 65 Montana 77 2.31 19 57
Montana 77 2.31 19 44 Nebraska 97 2.28 16 49 Nevada 166 2.19 24 48 :w Hampsh 177 2.27 18 35 New Jersey 143 2.31 24 54 vew Mexicc 157 2.17 15 56 New York 111 2.43 25 48 orth Carolir 330 1.89 13 59 lorth Dakot 63 2.33 14 39 Ohio 165 2.21 22 51 Oklahoma 184 2.19 16 82 Oregon 68 2.25 19 51 ennsylvani 121 2.31 20 50 thode Islanı 138 2.23 20 50 Juth Carolir 237 1.93 12 65 outh Dakot 95 2.34 13 45 Tennessee 236 2.19 13 60 Texas 222 2.08 17 69 Utah 100 2.37 16 50 Vermont 64 2.36 16 44 Virginia 270 2.04 16 58 Nashingtor 77 2.19 20 49 Vest Virgini 144 2.11 15 55 Wisconsin 97 2.38 19 46 Wyoming 102 2.31 19 46
PLANT
OUTPUT (OOO TONS)
CAPITAL ($000)
LABOR (O00 WORKER HOURS)
1 605.3 18,891 700.2 2 566.1 19,201 651.8 3 647.1 20,655 822.9 4 523.7 15,082 650.3 5 712.3 20,300 859 6 487.5 16,079 613 7 761.6 24,194 851.3 8 442.5 11,504 655.4 9 821.1 25,970 900.6 10 397.8 10,127 550.4 11 896.7 25,622 842.2 12 359.3 12,477 540.5 13 979.1 24,002 949.4 14 331.7 8,042 575.7 15 1064.9 23,972 925.8