Dear all
I am estimating IV model. I would like to cluster at the village level
We have only two villages.
Both x and z are dummy variables and we have x=1 and z=1 in both villages.
When I estimate
xi: ivreg2 y (x=z) i.village , cluster (village)
I got the following error message.
"Warning: estimated covariance matrix of moment conditions not of full rank.
overidentification statistic not reported, and standard errors and
model tests should be interpreted with caution.
Possible causes:
number of clusters insufficient to calculate robust covariance matrix
singleton dummy variable (dummy with one 1 and N-1 0s or vice versa)
partial option may address problem."
This sounds that clustering by only two village is not feasible.
However, if I estimate OLS
xi: y x i.village, cluster (village)
It works.
"partial option" did not help.
Can somebody give me advice on why this happen?
Thank you very much!
Related Posts with clustered standard error with IV
Time-varying interaction term with year fixed effectsHi, I am investigating the effect of a commodity price on conflict. I have created a grid of cells w…
multiple values for same value labelHi everyone, I am working with a categorical variable called Code: plnowm which expresses the mont…
Export*coefficient and standard error of factor variableHi! Let's say this is my data Code: * Example generated by -dataex-. For more info, type help data…
ivreg2 and interactions of the endogenous regressorHi have a question about ivreg2. It has been asked before and I have gone through the helpful posts.…
Quantile Panel RegressionHello. I just wanted to know this. How do I exactly know when to use quantile panel regression …
Subscribe to:
Post Comments (Atom)
0 Response to clustered standard error with IV
Post a Comment