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Re: st: Clustering Standard Errors.


From   Nils Braakmann <[email protected]>
To   [email protected]
Subject   Re: st: Clustering Standard Errors.
Date   Mon, 14 Jun 2010 21:19:08 +0200

Hi Natasha,

I guess the two approaches should give identical results (although I'm
not sure how two-way clustering is implemented in e.g. xtivreg2). The
-egen ... group()- approach essentially creates all possible
combinations of (in your case) industry and region and clusters on
that. In my understanding, two way clustering should do the same.

Best,
Nils

On Mon, Jun 14, 2010 at 4:50 PM, natasha agarwal
<[email protected]> wrote:
> Thanks Nils.
>
> How would you know whether you need to do two-way clustering or
> generate a cluster variable?
>
> Thanks
> Natasha
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