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RE: st: mean group


From   Nahla Samargandi <[email protected]>
To   "[email protected]" <[email protected]>
Subject   RE: st: mean group
Date   Tue, 21 Jun 2011 14:56:05 +0100

Thank you indeed for replying.
There are more that one command regarding the MG which of them that use to estimate Error correction Model  - TO estimate a long - short Run relationship  (ARDL ) Autoregressive distributed lag )

1-
 ECM - MG
xtmg dlY llY llW llK dlW dlK , trend robust

2-
nlcom ((_b[llW])/(-_b[llY])) ((_b[llK])/(-_b[llY])) , post

I got this result from the first one, 
gen dgdp=l.gdp etc

 xtmg  dgdpg lngdpc0   deducation  dlnca  dlnpop  dfl1, trend

Pesaran & Smith (1995) Mean Group estimator
All coefficients present represent averages across groups (cou)
Coefficient averages computed as unweighted means
Mean Group type estimation                      Number of obs      =      1306
Group variable: cou                             Number of groups   =        52
                                                Obs per group: min =        12
                                                               avg =      25.1
                                                               max =        28
                                                Wald chi2(4)       =     36.51
                                                Prob > chi2        =    0.0000
------------------------------------------------------------------------------
       dgdpg |      Coef.   Std. Err.      z    P>|z|     [95% Conf. Interval]
-------------+----------------------------------------------------------------
     lngdpc0 |  (omitted)
  deducation |    8.75228   11.61385     0.75   0.451    -14.01045    31.51501
       dlnca |   5.732087   1.806081     3.17   0.002     2.192234     9.27194
      dlnpop |   500.2783   321.8142     1.55   0.120    -130.4659    1131.022
        dfl1 |  -6.580965   1.245776    -5.28   0.000    -9.022641    -4.13929
  __000007_t |   .2274885    .151299     1.50   0.133    -.0690521    .5240291
       _cons |  -11.20187   8.003771    -1.40   0.162    -26.88897    4.485233
------------------------------------------------------------------------------
Root Mean Squared Error (sigma): 4.1932
Variable __000007_t refers to a group-specific linear trend.
Share of group-specific trends significant at 5% level: 0.038 (= 2 trends)

however , I cant interpret the result, because I need to know the short and long run effect , I don't think the estimation above is the right one for this.

regarding this command

nlcom ((_b[llW])/(-_b[llY])) ((_b[llK])/(-_b[llY])) , post
could you tell me is this the right one ? if yes, where i have to replace my variable?

Best regards,
Nahla

________________________________________
From: [email protected] [[email protected]] On Behalf Of Markus Eberhardt [[email protected]]
Sent: 21 June 2011 14:20
To: [email protected]
Subject: Re: st: mean group

xtpmg (Blackburn and Frank) with option -mg- gives you an ECM version
(well, it reports the implied long-run results as well as the
short-run results; an option to see the results country by country is
also given).

ARDL means autoregressive distributed lag, which is a levels
regression with lagged dependent variable and contemporaneous and
lagged covariates. This is mathematically equivalent to an ECM, which
has the first difference of y as dependent variable and then adds
lagged levels of y and x as well as contemporaneous and lagged
differences of x (and lagged ones of y, too) as covariates. Hendry
(1995) 'Dynamic Econometrics' has a discussion for a single time
series how ARDL is the encompassing specification for a lot of dynamic
models, including ECM. In terms of interpretation of coefficients you
will get the same long-run results, although they're constructed
differently. Furthermore, an ECM approach allows you to impose a
long-run relationship (y-beta*x) as 'ecm' variable in order to focus
on short-run dynamics and the speed of convergence/error correction
mechanism.

If you create lags manually (gen lx=l.x etc.) you can also use my xtmg command.

Both xtpmg and xtmg commands can be found using -findit- in Stata.

Best
m

Markus Eberhardt
ESRC Post-doctoral Research Fellow, Centre for the Study of African
Economies, Department of Economics, University of Oxford
Stipendiary Lecturer, St Catherine's College, Oxford

web: http://sites.google.com/site/medevecon/home
email: [email protected]
twitter: http://twitter.com/sjoh2052
mail: Centre for the Study of African Economies, Department of
Economics, Manor Rd, Oxford OX1 3UQ, England




On 21 June 2011 13:30, Nahla Samargandi <[email protected]> wrote:
> Hi,
> I would like know the right command for mean group MG  estimator in error correction model form (ARDL)developed by Pesaran 1999,
>
> thank you in advance for your help
> *
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> *   http://www.ats.ucla.edu/stat/stata/
>

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