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June 4th, 2017, 05:42 AM   #1
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Regression

Hello!

I need help to interpret my regression results. i have a hard time understanding when there is percentage point or not.

My regression:

i have an excel file with following variables:

Real GDP growth / capita
i have calculated this myself with formula ((year 2 -year 1)/year 1)* 100

Real GDP / capita year t-1
just lagged one year back

Delta minimum wage
calculated myself with ((year 2 -year 1)/year 1)* 100 , (thus i have the level of minimum wage too but its not included in my regression)

Delta unemployment
calculated myself as year 2 - year 1 ex: 5,7 - 5,5 = 0,2

Unemployment year t-1
expressed as 5,7 meaning 5,7%

Regression 1: Y Real GDP growth / capita = delta minimum wage + Real GDP / capita t-1

Regression 2: Y delta unemployment = delta minimum wage + unemployment t-1


Results: regression 1: Y (Real GDP growth / capita) = 0,159*** + -0,0143*(minlwage) + -0,0002397***(gdp level)

regression 2: Y (delta unemployment) = 0,890209** + 0,006508*(minwage) + -0,230477***(unemployment level)

To interpret these results more i do this:

regression 1:
an increase of minimum wage by 10% will lead to a decrease in GDP growth/ capita by 0,143 %. I then took the average growth in GDP/capita over the period i studied and found 1,77%. Can i say that the new growth would be 1,77 - 0,143 = 1,627% ?

Regression 2:
an increase of the minimum wage by 10% will lead to an increase in unemployment by 0,06508%. I looked up the unemployment numbers in USA which is 4,4% and 7 000 000 people. Thus 1% means 1 590 909 people. New unemployment will be 4,4 + 0,06508 = 4,46508 . 4,46508 * 1 590 909 = 7103535 people. increased unemployment number is thus: 103535 people ?

Am i interpreting this right? or do i mix percentage and percantage point?
chaarleey is offline  
 
June 4th, 2017, 08:06 AM   #2
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This is a duplicate post that I have answered in the economics forum, but the question seems to me to deserve to be looked at by statisticians as well as economists.
JeffM1 is offline  
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