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Re: st: Small sample with clustered data
From
Austin Nichols <[email protected]>
To
[email protected]
Subject
Re: st: Small sample with clustered data
Date
Mon, 28 Nov 2011 14:00:41 -0500
Lars <[email protected]>:
You are likely to have SEs biased downward no matter what you do, if
you use the 24 cluster design--can you cluster by country (50
clusters) but include eucluster as an explanatory variable?
On Mon, Nov 28, 2011 at 6:24 AM, <[email protected]> wrote:
> Dear Statalist,
>
> My sample consists of 50 countries with 26 of them being EU Member States.
> The problem is that the values of the dependent variable for the EU members are not
> independent of each other. Thus, I created a dummy variable "eucluster" that indicates
> if a country is in the EU (1=yes; 0=no) and used the cluster(eucluster) option after the
> OLS Regressions in Stata 10. However, in "Clustered Errors in Stata"
> (Nichols/Schaffer 2007 -http://repec.org/usug2007/crse.pdf) it is mentioned that if M,
> the number of clusters, is small matters could even get worse by using the cluster option (Sheet 20).
> M=50 seems to be the minimum number of clusters required.
>
> I have 24 clusters consisting of 1 country and 1 cluster comprising 26 EU members (6 independent variables).
> I do not know how to deal "correctly" with these clustered data in Stata. Hence, I would highly appreciate if someone could
> give me advice or suggest a solution on how to deal with the clustered data in such a small sample.
>
> Thanks for Consideration.
>
> Lars
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