In: Statistics and Probability
One of the concerns of labor economists is that in economic
recessions, older people may be more likely to be laid off than
workers under the age of 40. Federal and state laws prohibit this
from happening, but does it anyway? The Federal government collects
data on what they call “reductions in force” (RFI); for a recent
company that experienced a layoff, 42 of the 50 employees who were
“released” were over 40 while 764 of the 1267 who were not released
were over 40.
What is your impression of the data? Then perform the chi-square
test for (how many??) degrees of freedom. What can you say with 95%
confidence about the possibility of age discrimination in RIFs?