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ECON 1030

BUSINESS STATISTICS

Group Assignment

Instructions:

This is a group assignment with groups officially registered on canvas - the maximum group size is three.   All group members must be enrolled in the same tutorial class (i.e. day, time, and tutor).  

There are two parts to this assignment: 

Part A: 

Report to the Australian Productivity Commission.

Part B:

A ministerial brief to the Minister for Employment, Skills, Small and Family Business.

Weights

This assignment is worth 40 marks. The allocation of marks is as follows:

Part A	32
Statistical Analysis (including excel)	24
Professional Report	8
Part B	8
Total	40

Report Structure

The response to Part A must be provided in the form of a professional report with no more than 10 pages (excluding the cover page).  

The structure of your professional report must include:

· A Title,

· An Executive Summary,

· An Introduction,

· Analysis and

· Conclusions.

The response to Part B must be provided in the form of a ministerial brief with no more than 200 words and 3 graphs.

Submission

· You must submit an electronic copy of your assignment on Canvas. See the attached Template of your submission for more details.  

· Only one submission is required per group.  

· Hard copies will NOT be accepted.

· It is very important that you submit an assignment cover sheet with all the group members’ signatures/names at the time of submission. If any dispute arises regarding your contribution to the group work, the cover sheet will be used as evidence of contribution.

· Each group is required to submit the following three documents in order:

1) Cover sheet.

2) The main report including a ministerial brief in the same document.

3) Excel file properly formatted.

Excel Work

This assignment requires the use of Microsoft Excel.  Using Data Analysis Tool-Pack will assist tremendously in getting through the assignment requirements.

You need to submit the Excel file along with your report. The excel file needs to be clear and carefully organized and must show all workings underlying the Professional report and associated statistical analysis. It will be treated as an appendix to your report, i.e., not included in the page count.

DO NOT leave references to the excel workbook within the Professional report as responses to the questions. You will need to take relevant results from your Excel workbook and incorporate them into your report. The report needs to be standalone.

Presentation Instructions:

Your written professional report should comply with the following presentation standards:

1) Typed using a standard professional font type (e.g. Times Roman), 12-point font size.

2) 1.5-line spacing, numbered pages, and clear use of titles and section headings.

3) Delivered as a Word (.doc or .docx) or PDF (.pdf) file.

4) Checked for spelling, typographical and grammatical errors. Where relevant, round to 3 decimal places.

5) With all relevant tables and charts, the report should be no more than 10 pages long.

Problem Description:

In a well-functioning labour market, individuals with the same productive attributes (e.g. education attainment, working experience) should be equally paid. The existence of the public-private pay gap for individuals with similar productive characteristics has implications for efficiency and equity in the labour market. For instance, this implies that employees in the public sector receive rent at the cost of taxpayers, and the private sector activities may be crowded out as it becomes hard to retain employees.  

You have been appointed by the Australian Productivity Commission to analyse the public-private pay gap in Australia. The data are drawn from the 2019 HILDA (Household, Income and Labour Dynamics in Australia) survey. Using the tools learned in your current Business Statistics course provide the Commission with an analysis of the public-private pay gap. You may assume that the Commission members have a good understanding of basic statistics.

In addition, the Commission would like you to prepare a ministerial brief to illustrate the key findings of your analysis to the Minister for Employment, Skills, Small and Family Business.

Key points to follow:

· Locate the data file (AssignmentBusStats.xls) on CANVAS.

· Use the 5% significance level and the 95% confidence level where relevant or not clearly specified and required.

· While explaining your findings, please ensure that you explain both statistical findings and provide interpretations in the context of the scenario.

There are two parts to this assignment, each described in detail below:

Part A: 

1. Focus on the variable wage for the public sector employees only for this question. As shown in several lectures, there are two distinct methods of calculating summary or descriptive statistics using Excel. This question requires you to use both methods.

a. First use Excel Data Analysis Tool Pack (the descriptive statistics option) to calculate summary statistics. 

b. Second use Excel to stepwise calculate summary statistics. Here you would estimate a whole range of statistics to measure central tendency, variation, and the shape of the data – based on what you learned under Topic 1. 

These calculations should be carefully laid out in Excel and should NOT use any hard-wired Excel statistical functions e.g. Average, Median, Mode, STDEV, VAR, QUARTILE, etc.

You can use the Excel sort command, the sum command, and any other non-statistical excel commands.  

(1.5 marks)

2. Repeat step 1 above for the variable wage for the private sector employees.

(1.5 marks)

3. Using results from 1) and 2) above, tabulate and interpret relevant summary statistics in the report, comparing across public and private sector employees.

(3 marks) 

4. Construct histograms of the wage distributions for the public and private sector employees respectively. When drawing the histogram, use interval widths of 10 ($’000) beginning with $0 ($’000). Draw separate histograms for the two sectors. Interpret the graphs carefully.

      (2 Marks)

5. What are the main differences in demographic and social-economic characteristics between employees in the public and private sector? Aid your answer with appropriate tables/graphs.

(3.5 Marks)

6. A media report claims that the mean hourly wage for public sector employees in Australia is $40 in 2019. Do you agree? Using a critical value method, perform a hypothesis test at the 5% and 1% significance levels. Clearly label your diagram and indicate any assumptions made. Carefully explain any potential errors in your decision-making.

(3.5 Marks) 

7. The Australian government would like to have a rough idea about the mean hourly wage rate for both sectors. Propose a statistical method to estimate the mean hourly wage rate for public sector employees and private sector employees, respectively. List any assumptions made and explain carefully your findings.

(2.5 Marks) 

8. Since the data file (AssignmentBusStats.xls) suggests a higher mean hourly wage rate in the public sector, a researcher hence states that the population means hourly wage rates for public and private sectors are different. Do you agree? Propose a statistical method to examine whether the researcher’s statement is true or not. Clearly indicate any assumptions made.

(3.5 Marks)

9. Should the Minister be concerned that the population mean hourly wage rate is higher in the public sector?

(3 Marks)

 (1.5 +1.5 + 3 + 2 + 3.5 + 2.5 + 3.5 + 3.5 + 3 = 24 marks)

(Professional report = 8 marks)

Part B: 

Write a ministerial brief of no more than 200 words containing no more than 3 graphs on the public-private pay gap in Australia and any other interesting findings that would be of policy relevance to the Minister. Draw on the relevant evidence you have gathered from Part A, as well as other information/evidence not covered here but you believe is useful. Your brief should summarize your results from part A in a non-technical way and provide relevant conclusions.

(8 marks)