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Question: oblem 1 we know us political candidates spend an awful...

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oblem 1: We know U.S. political candidates spend an awful lot of time raising money . Do we know if the Problem 1: We know U.S And we know they use the money to inflict mind-numbing ads on us money and the ads it buys actually work? That share? Jacobson (1978), Erikson and Palfrey (2000), an is, does campaign spending increase vote d others grapple at length with this iss sue. Consider the following model: Vote share, - Bo + B,Campaign spendings + e, is where Vote share, is the vote share of a candidate in state s and Campaign spendings the spending by candidate s. a) What does Bo mean? What does B1 mean? b) What is in the error term? c) What are the conditions for the independent variable X to be endogenous? d) Is the independent variable likely to be endogenous? Why or why not? e) Explain how endogeneity could lead to incorrect inferences?
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