** Chapter 6.3 ** for W.H. Greene, Econometric Analysis 6th ed. *****************
* (c) Noel Roy 2003, 2008
*
*                                   NONLINEARITY IN THE VARIABLES
*                                    6.3.1 Functional Forms
*
* The tutorial for this section will review the following tasks in SHAZAM:
* •	Use of index variables in DO commands
* •	Storing coefficient estimates
* •	Generating graphs
*
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*
* Replicate Figure 6.3.
* Repeat the regression in Example 4.3.
*
SAMPLE 1 753
READ (TableF4-1.txt) LFP WHRS KL6 K618 Age Educatn WW /SKIPLINES=37
SET NOWARNSKIP
SKIPIF (1-LFP)
GENR LNEARN=LOG(WW*WHRS)
GENR Age2=Age**2
GENR Kids=DUM(KL6+K618)
?OLS LNEARN Age Age2 Educatn Kids / COEF=B
*
* Calculate predicted earnings for all ages between 20 and 65,
* for Education=12 and Kids=1.
*
DIM EARNINGS 46 
GEN1 CON=B(3)*12+B(4)+B(5)
DO #=1 46
GEN1 EARNINGS(#)=EXP(B(1)*(#+19)+B(2)*(#+19)**2+CON)
ENDO
* Graph Earnings against Age.
DEL Age
SAMPLE 1 46
GENR Age=TIME(19)
GRAPH Earnings Age /LINEONLY NOKEY
STOP
*
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*
* Updated September 2, 2008