Question

Suppose a study finds that college students who received financial aid have a greater tendency to graduate than do college students who do not receive financial aid. What is the identification problem that the authors must solve? If the authors conclude on the basis of the data that receiving financial aid increases the ability of college students to graduate, are they correct? What would be the best solution to the identification problem? Explain.

Answer 1

Answer:

Consider the following explanation

Explanation:

1 First he has,reasonably detailed knowledge of the market in question

2.The second general approach is to use advanced statistical analysis to identify the data

3.Author must collect data not only related to financial aid and college graduates but also on the many variables that can effect these variables .

4.Once the data are collected (which is often much more difficult than it sounds!), the author can then use some advanced statistical techniques to estimate the parameters, including one technique called multiple regression analysis.

If the author has done all these above things on the data ,then i think that his conclusion will be correct.

The best solution to the identification problem is  it requires knowledge of the various variables that effect both the financial aid and college graduates so that advanced statistical estimation can be undertaken, In either case, however, knowledge of financial aid and college graduates alone is not sufficient to identify the data and drawing conclusions on the basis of it.