I'm currently calculating a generalized DiD model and I'm unsure if my approach is the right one. Accordingly, I would be very happy about your help, many thanks in advance!
Basically I have panel data holding the data of several firms for several quarters. The firms introduced a creative training in some quarter (the treatment) and I wan't to check how this affects the quarterly quality of submitted ideas from the employees that received the training to a suggestion system these firms introduced in the past. Further, I want to check whether this training was more efficient for employees from innovation-related departments of the firm (creative department etc.). I also have some control variables, including the industry of the firm, the total number of idea submissions and the age (in quarters) since the suggestion system was introduced. My dataframe looks like this (dummy data):
firm | quarter | inno_department | training | average_quality | industry | submissions | age |
abc | 2015Q1 | 0 | 0 | 0.7 | manufacturing | 115 | 4 |
abc | 2015Q1 | 1 | 0 | 0.8 | manufacturing | 115 | 4 |
abc | 2015Q2 | 0 | 0 | 0.9 | manufacturing | 120 | 5 |
abc | 2015Q2 | 1 | 0 | 0.7 | manufacturing | 120 | 5 |
abc | 2015Q3 | 0 | 1 | 0.1 | manufacturing | 114 | 6 |
abc | 2015Q3 | 1 | 1 | 0.3 | manufacturing | 114 | 6 |
abc | 2015Q4 | 0 | 1 | 0.3 | manufacturing | 130 | 7 |
abc | 2016Q1 | 0 | 1 | 0.4 | manufacturing | 125 | 8 |
abc | 2016Q1 | 1 | 1 | 0.4 | manufacturing | 125 | 8 |
abc | 2016Q2 | 1 | 1 | 0.5 | manufacturing | 115 | 9 |
def | 2013Q1 | 0 | 0 | 0.3 | IT | 80 | 1 |
def | 2013Q2 | 0 | 0 | 0.4 | IT | 75 | 2 |
def | 2013Q2 | 1 | 0 | 0.3 | IT | 75 | 2 |
def | 2013Q3 | 0 | 0 | 0.3 | IT | 70 | 3 |
def | 2013Q3 | 1 | 0 | 0.2 | IT | 70 | 3 |
def | 2013Q4 | 0 | 0 | 0.2 | IT | 75 | 4 |
def | 2013Q4 | 1 | 0 | 0.5 | IT | 75 | 4 |
def | 2014Q1 | 0 | 1 | 0.4 | IT | 80 | 5 |
def | 2014Q1 | 1 | 1 | 0.3 | IT | 80 | 5 |
def | 2014Q2 | 0 | 1 | 0.3 | IT | 90 | 6 |
def | 2014Q3 | 0 | 1 | 0.2 | IT | 80 | 7 |
def | 2014Q3 | 1 | 1 | 0.3 | IT | 80 | 7 |
ghi | 2016Q1 | 0 | 0 | 0.4 | manufacturing | 40 | 3 |
ghi | 2016Q1 | 1 | 0 | 0.5 | manufacturing | 40 | 3 |
ghi | 2016Q2 | 0 | 0 | 0.5 | manufacturing | 30 | 4 |
ghi | 2016Q4 | 0 | 0 | 0.4 | manufacturing | 70 | 6 |
Without the inno_department variable I would "just" take the quarterly average over all employees and calculate it like this:
qualityit = αi + δt + βtrainingit-1 + εit
Code:
xtest firm quarter xtreg average_quality L.training, fe vce cluster(firm)
qualityit = αi + δt + βtrainingit-1 + γXit + εit
Code:
xtest firm quarter xtreg average_quality L.training i.industry submissions age, fe vce cluster(firm)
With the inno_department variable I have repeated time values within my panel and I'm not quite sure how to approach this. Basically I would like to caluclate a moderation effect like this:
qualityit = αi + δt + βtrainingit-1+ π(trainingit-1 ∗ innodepit) + ρinnodepit + εit
So my question is: Is this even possible? Would I have to restructure my data for this? How should I setup xtest and xtreg? Thank you!
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