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RE: st: xtivreg2 with factor variables
From
David Torres <[email protected]>
To
"[email protected]" <[email protected]>
Subject
RE: st: xtivreg2 with factor variables
Date
Mon, 30 Dec 2013 17:34:40 -0500
Anat,
Try the xi: operator before the command.
xi: xtivreg2 log_ss dem gini gdp i.year, fe cluster(country_code year) bw(1)
That will automatically break year out into dummy variables.
I'm surprised, though, that you're using -xtivreg2- in the absence of any instruments. I would argue that if you want to treat year as continuous, you should rethink the model. You might also prefer using -xtivreg- over -xtivreg2-. For instance, say you need to instrument for one of the variables in your model, say gdp. Let's give the instrument a generic name, say rainfall. You would do something like this:
xtivreg log_ss dem gini c.year (gdp = rainfall), re vce(cluster country_code)
and interactions are also possible:
xtivreg log_ss dem gini gini#c.year (gdp = rainfall), re vce(cluster country_code)
The last model here assumes gini is a time-invariant predictor for which you want to know its relationship to time.
Cheers,
--
David Diego Torres, PhD
NSF SBE Postdoctoral Research Fellow
Houston Education Research Consortium
Rice University
6100 Main Street, MS-28
Houston, TX 77005
Phone: 713-348-2984
Email: ddtorres at rice dot edu
----------------------------------------
> Date: Tue, 31 Dec 2013 00:15:11 +0200
> Subject: st: xtivreg2 with factor variables
> From: [email protected]
> To: [email protected]
>
> Dear all,
> I have an unbalanced panel of macroeconomic data on 35 countries over 17 years.
> My analysis shows that time effects are jointly significant, as well
> as indicated first order autocorrelation.
> I
> therefore ran the following command:
> . xtivreg2 log_ss dem gini gdp i.year, fe cluster(country_code year) bw(1)
>
> I got the following error: factor variables not allowed
> Shell I specify each year dummy (excl. one) or is there a different
> problem here?
> Any advise will be appreciated!
> Anat
>
>
> --
> Anat Tchetchik, PhD
> Department of Business Administration
> Guilford Glazer Faculty of Business and Management
> Ben-Gurion University of the Negev
> P.O.Box: 653
> Beer-Sheva, Israel, 84105
>
> E-mail: [email protected]
> Phone 972-(0)8-6479735
> Fax: 972-(0)8-6472920
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