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Why do I get the error message "no room to add more observations"?

You need to allocate more memory to Stata. You can do this by typing set memory #, where # is the amount of memory you want to allocate.

        set memory 20000

or

        set memory 20m

Both commands will allocate 20 megabytes of memory.

There are two important considerations when deciding how much memory to allocate.

1. Make sure that you allocate an amount of memory that is larger than the file that you are using. If your file is 30 megabytes, you may want to allocate 50 megabytes of memory to Stata. Stata will need the extra room to perform any commands or calculations. A good rule of thumb for large files is to allocate roughly 50% more memory than the size of your file. If you are using smaller files (< 10 megabytes), then allocating 15 megabytes on a PC with 128 megabytes of RAM is a good general guideline.
   

   set memory 15m

2. Make sure that you do not allocate too much memory because your computer will not have enough memory (RAM) left to perform other tasks. For example, if you only have 256 megabytes of RAM, then you should not allocate more than that. If you have a file that is larger than the amount of RAM installed on your computer, you will have to acquire more memory, work on a more powerful computer, or sacrifice speed by using virtual memory. See FAQ: How can I use a dataset that is larger than the available RAM? for more information about virtual memory and Stata.

To read more about memory usage in Stata, see appendix B in the Getting Started with Stata manual.