Measurement error

1 (a)

Recall that

= 0 + 1 +

Can be expanded as

= 0 + 1 + [1 ( ) + ]

Letting = [1 ( ) + ], then

= 0 + 1 +

Hence = 1 ( ) +

Since = +

Replacing in the equation for above yields

= 1 ( ) +

Hence

= 1

b)

(i) Since , and are independent, their covariance are zero, that is

= 1 ( ) + = 1 + and hence ( , ) = 0 and ( , ) =

( + , ) = 2 hence ( , ) = 1 (
1 , ) + ( , ) = 1 2

(ii)

( , ) = 0

(iii) ( , ) = ( + , ) = 2

(iv) ( , ) = 1 (
1 , ) + ( , ) = 1 2

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(c)

If 1 is biased, then the direction will depend on the correlation between and the measurement

error . The correlation in turns depends on the specific nature of the measurement error.

(d)

(i)

Recall, 1 1 +

As probability increases, 1 does not converge in probability to the true value of 1 . As the

probability value increases, only is persistence in large sample, hence is the biased

in 1.

(ii) Recall that ( , ) = 0, then ( ) = ( , ) + ( , ),

But ( , ) = 0, hence

( ) = 2 + 0 = 2

Since

( + , ) = 2

(iii) Recall that

= 1 ( ) + = 1 + and since ( , ) = 0 and (1 , ) =

( + , ) = 2 hence ( , ) = 1 (
1 , ) + ( , ) = 1 2

Therefore,

2

1 1 1 2 /2

Now

2 = 2 + 2

Hence

1 2 2
1 1 = [ ]
2 + 2 2 + 2 1
2

e) In a classical measurement error, 1 is inconsistent since the ratio 2 +
2 < 1 and hence 1

will be biased towards zero even in large samples. In extreme cases, no information about

remains relevant hence the ratio of variance in the final expression is zero while 1 converges

in p to zero. In other extreme, the measurement error become irrelevant that is, 2 = 0 so that

1 1. Therefore, the magnitude or absolute value of 1 in the classical measurement error

model cannot exceed the true value of 1.

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f) In a classical measurement error, 1 is inconsistent since the ratio 2 2 < 1, showing
+

that 1 biasness tends to zero. In one instance in an extreme case, 2 = 0, hence

1 1. Furthermore, in other extreme scenario, the information about becomes more

irrelevant, hence ratio of variance becomes zero. From the above case, when 2 = 0, then the

2
2
bias 2 + 2 is close to 1, while when is irrelevant, then the 2 + 2 is not as close to 0.

2.

a) For each potential threat to internal validity, assess whether or not it poses a problem in the

regression and explain why or why not. List each threat clearly. If necessary, make further

assumptions about the nature of the data and state them clearly.

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One of the major threats is maturation. The migration of people within the bay area might last

for more years than anticipated, hence number of unemployed immigrants might increase. This

might have a significant effect on the regression equation. People may also tend to stay in their

countries despite the economic conditions, hence many might be jobless but still prefer their

countries. This might bias the results towards zero.

Other major threat is statistical regression, also termed as regression towards the mean. The

number of immigrants might increase at Bay area though the immigrants might be unemployed

hence floor effect might be realized. For instance if the immigrants have no proper education,

how would they secure jobs in Bay area, it thus mean that the subject might be on the extreme

scores or characteristics.

The selection of subjects that is randomization might also lead to biasness if the sample group

design is small. This implies that the majority of the group selected might influence the results

while the true picture presents otherwise.

Experimental mortality: people may learn to stay in their countries and seek employment

there after some period of time. This will lead to loss of subjects, this might skew the results.

(b) In your opinion, what are the two most important threats to the

study's internal validity? Explain why.

Statistical regression and experimental mortality. This is because both of them might lead to

skewed results and loss of the regressor meaning.

(c)

(i) A high school principle generalizing the finding on class sizes and test scorers to the

population of high school might be externality valid since the test score might also be affected

by teacher-to-student ratio besides many other factors.

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(ii) Relating the finding of laboratory experiment to the generalized growing of organic

tomatoes in the laboratory to the field is not externally valid since how organic tomatoes thrive

in laboratory might be different from how it thrives in field setting. In the laboratory, threats to

organic tomatoes might be lacking hence they may thrive well as compared to the fields where

the threat are numerous.