Explanatory power of education and occupation dummies, 1979–2007
|R-squared||Partial R-squared||R-squared||Partial R-squared|
Note: The R-squares are from cross-sectional OLS regressions of log hourly wages on a set of either education dummies (less than high school, some college, bachelor’s degree only, advanced degree), 10 major occupation dummies, or the 250+ detailed occupation dummies, along with (in all cases) a quartic in age, and dummies for region of the country (using the four major Census regions), marital status, and race/ethnicity (using mutually exclusive categories of white nonhispanic, black nonhispanic, Hispanic any race, and other). The partial R-squares are calculated in the following way: the log hourly wage and each control variable of interest (the education dummies, major occupation dummies, or detailed occupation dummies) is separately regressed on the remaining controls (the quartic in age and the dummies for region, marital status, and race/ethnicity). Using the residuals from these regressions, residual log hourly wages are regressed separately on the residuals from each of the three variable groups of interest. The partial R-squares are the R-squares from these regressions.
Source: Authors' analysis of Current Population Survey Outgoing Rotation Group.
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