Thank you, folks. Your suggestions have been very helpful.
I like the idea of adding important state-wide variables, although some may
still argue that some state-wide effects may never be observed but have
significant impacts.
Again, thanks
Gao
-----Original Message-----
From: [email protected]
[mailto:[email protected]] On Behalf Of Maarten buis
Sent: Thursday, August 02, 2007 5:49 PM
To: [email protected]
Subject: Re: st: Disentangle unobserved state effect
--- "Gao Liu" <[email protected]> 08/01/07 10:40 PM >>>
> > the results of the impact of these policies on school districts may
> > capture some unobserved state-wide effects.
--- Mansour Farahani <[email protected]> wrote:
> If you can add to your model some variables at state level that
> affect your dependent variable, say level of poverty, average income,
> Gini, or the like, then you can probably have a better estimates of
> your policy effects.
This is actually my favourite way of dealing with unobserved effects:
just observe them. I am serious (though I like the pun), especially
economists seem to be totally obsessed with everything they haven't
observed, start building all kinds of models around it, critisize the
assumptions of other models (preferable made by other persons from
other universities), even make the estimates of the unobserved effects
the main feature of the analysis, and thus forget everything the have
observed.
-- Maarten
-----------------------------------------
Maarten L. Buis
Department of Social Research Methodology
Vrije Universiteit Amsterdam
Boelelaan 1081
1081 HV Amsterdam
The Netherlands
visiting address:
Buitenveldertselaan 3 (Metropolitan), room Z434
+31 20 5986715
http://home.fsw.vu.nl/m.buis/
-----------------------------------------
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