Re: st: When number of regressors greater than the number of clusters in OLS regression

[Steven Samuels <sjhsamuels@earthlink.net>]

Divya,
I reread your question and realize that you probably do not have  
sample data at all. The Census of India was not a sample at all, but,  
ideally, was a 100% enumeration. (Just as in other countries, this  
will not be perfectly true.) So, I am not sure that you should be  
clustering on State, or even on district, for that matter. Please  
reply with details about your observations. For example, do you have  
information on individual households or just district totals?

Regards,

Steven


On Sep 1, 2008, at 1:05 PM, Steven Samuels wrote:


> More basic questions, Divya:  What is your target population:  the  
> 17 states (of India, perhaps?) or the entire country?  Were the 17  
> states selected from all states by a sampling process?  Or were  
> they chosen in some other way--for example, because they had data  
> available.  Are all districts from the selected states in your sample?
>
>
> -Steven
> On Sep 1, 2008, at 12:35 PM, Divya Balasubramaniam wrote:
>
>
> > Dear Dr.Schaffer,
> >
> > I am using clustering in my analysis and I am having some trouble  
> > understanding some of the important issues. I have read several  
> > papers you have written on clustering issues and hence I am  
> > emailing you to seek help.
> >
> > I am doing a district level analysis for the census year 2001. I  
> > have 436 districts in total coming from 17 States. I run an OLS  
> > regression of Share of households having tap water access on  
> > several controls variables (I have about 25 Regressors).  I use  
> > the STATA command areg Y on X, absorb(State) cluster(state). I  
> > have the state fixed effects and clustered by State.
> >
> > My question is: I have more regresors(25) than the number of  
> > clusters(17). I also find in the STATA output that I have F-stat  
> > missing. I would like to seek your advice on whether I can make  
> > inference by looking at the individual coefficient estimates and  
> > the reported robust Standard errors. I did see your comment on  
> > this issue on the STATA listserv. However, I could not find  
> > answers as to how to fix this problem of having more regressors  
> > than the number of clusters.
> >
> > I will be extremely thankful if you can kindly help me in this  
> > regard.
> > Sincerely,
> > Divya.
> > =======================================
> > Divya Balasubramaniam
> > Economics PhD Student
> > Terry College of Business
> > University of Georgia
> > Athens -30602.
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