> My dependent variable is the mortality rate. Since the variance of
> ln(d/p)
> is inversely proportional to p (population), this implies
> heteroskedasticity. To correct for it, observations should be weighted
> by the square root of the denominator of the mortality rate, i.e.,
> population. In Stata, i am using
>
> xi: regress y x1 x2 i.country i.year [w=1/pop],
> Is that correct? I might also use the robust option
I can see why the variance of d/p is inversely proportional to the
population size, but I suspect that if it is a constant coefficient of
variation variable, then after taking logs the variances would get
stabilized. What am I missing?
--- Stas Kolenikov
-- Ph.D. student in Statistics at UNC-Chapel Hill
- http://www.komkon.org/~tacik/ -- [email protected]
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