State the null and alternative hypothesis

Micheller

New Member
Dear all,

Can someone please give me some advise on this one? I need to state the Ho en Ha hypothesis, I know how to do it in words but not in the appropriate notion. I need to state them for all 3 variables. I would be really grateful with some help. Thanks so much in advance

Here is what it is about:

A pair of scholars test the claim that international aid reduces the quality of governance in Africa. They measure quality of governance (Y) using an 18-point index from the International Country Risk Guide (ICRG) that takes into account bureaucratic quality, the rule of law, and corruption. Higher values indicate better governance. They measure international aid as the amount of foreign aid received by the country as a percentage of the country’s public spending (X1). Thus if X1=1, then a country receives an amount of foreign aid that is 1% of their public spending. They control for political violence, claiming that this also reduces the quality of governance. Political violence (X2) is measured as the number of years in the past ten in which there were one or more incidents of violent conflict or unrest. They also control for post-colonial legacy and claim that former British and French colonies will have a higher level of governance than countries with other post-colonial legacies. They use a dummy variable (X3), with 1 indicating former British and French colonies and 0 for others. They obtain the following results:

Y = 8 - (0.02*X1) - (2.4*X2) + (3*X3)
se1 = 0.02, se2 = 0.7, se3 = 1.0
R-Square = 0.64, N = 34.

Miner

TS Contributor
You are performing a multiple linear regression, so the null hypotheses are that the coefficients of each variable equal zero. The alternate hypotheses are that the coefficients do not equal zero.

Micheller

New Member
One more thing though: The question in the assingment was: "For each varianle, state the null and alternative hypothesis using appropiate notation."
So I have to state 3 different Ho and H1 right? Would all the H0 equals zero and all H1 not?
Thnx

Miner

TS Contributor
That is correct. Each coefficient has its own set of hypotheses.

shantiz

New Member
hallo michelle do you have the answers:

1) For each variable, state the null and alternative hypothesis using appropriate notation. The null and alternative hypotheses should correctly reflect the author’s claims.

2) Interpret the intercept, slopes, and R2 (do not state definitions!)

3) After choosing an appropriate alpha level, use a t-table to test each hypothesis in order to evaluate each claim. What conclusions should they draw with respect to each independent variable?

4) Estimate the value of the ICRG index for a country that receives foreign aid amounting to 7% of their public spending, that has experienced two years of violent conflict in the last ten years, and that is a former British colony.