I am conducting a Diff-in-Diff with the following data, which is copied in here by using the dataex command. The normal DD regression works just fine. However, I would strongly like to include control variables. All the ones that are expressed in percentages (GDP-growth, inflation, remmitances..) work fine too. The binary (dummy) ones, like membership in some supranational bodies, for instance the EU, do absolutely not. Stata always states that they're omitted because of collinearity and I do not get way this is the case, to be honest. The same variables work fine with FE and Random Effects and also in bigger samples than the one displayed below.
Code:
* Example generated by -dataex-. To install: ssc install dataex clear input int year str7 countryname str12 countryyear double new_avwgi byte(EU_candidate EU_member Intrastate_conflict) double(new_exports new_FDI new_GDP new_inflation new_remittances) byte(time BRI_state) float(did did_EUaccess) 2010 "Estonia" "Estonia.2010" 1.0663436849912007 0 1 0 75.07823021170658 13.302610404251492 2.259075893831181 2.97204512015696 1.8324759753382773 0 0 0 0 2011 "Estonia" "Estonia.2011" 1.0747986833254497 0 1 0 86.53972527282187 4.827558144959612 7.597300209245603 4.9819013145361 1.8919482862267252 0 0 0 0 2012 "Estonia" "Estonia.2012" 1.0621930360794067 0 1 0 85.98943858726155 7.7592920176217595 4.307258987653256 3.93339987296979 1.9998493379228786 0 0 0 0 2013 "Estonia" "Estonia.2013" 1.112437019745509 0 1 0 84.30308150402843 4.370606686465119 1.9365434443487857 2.78056658954996 2.2581279426120306 0 0 0 0 2014 "Estonia" "Estonia.2014" 1.220025469859441 0 1 0 81.802388001185 6.691461144936392 2.8885638447165007 -.106175146521716 2.0430252776096847 1 0 0 0 2015 "Estonia" "Estonia.2015" 1.1950828234354656 0 1 0 77.34500432713354 -3.1189166996698736 1.9002865897060275 -.492326006547338 1.9957658562540663 1 0 0 0 2016 "Estonia" "Estonia.2016" 1.1961500843365986 0 1 0 77.59978592650414 3.916098151538917 3.4890971114797082 .148684907627356 2.027937379229015 1 0 0 0 2017 "Estonia" "Estonia.2017" 1.1927852034568787 0 1 0 76.54409627801454 5.844004555823057 4.856686856443943 3.41723549488057 1.899560156901767 1 0 0 0 2010 "Serbia" "Serbia.2010" -.1452512772132953 0 0 0 32.25560609728482 4.049632331111981 .7310464430853898 6.14255360247246 9.847691855465044 0 1 0 0 2011 "Serbia" "Serbia.2011" -.10529540820668142 0 0 0 33.00182218001296 10.002289323791814 2.0362757259362922 11.1373976342129 8.036210678703773 0 1 0 0 2012 "Serbia" "Serbia.2012" -.1449378045896689 0 0 0 35.84480697786771 2.946768361558177 -.6815421330412903 7.33038589596636 8.19178067430819 0 1 0 0 2013 "Serbia" "Serbia.2013" -.09417816003163655 0 0 0 39.85150587567927 4.2555897728095555 2.892634162141732 7.69426362896666 8.317079992436222 0 1 0 0 2014 "Serbia" "Serbia.2014" .04181295136610667 1 0 0 42.07752997177007 4.2476586388978035 -1.5895061837666447 2.08244793880151 7.851232973416203 1 1 1 1 2015 "Serbia" "Serbia.2015" .058732101072867714 1 0 0 45.27361076131518 5.910584879417411 1.7763209728228588 1.39235822000187 8.5018044003722 1 1 1 1 2016 "Serbia" "Serbia.2016" .00017994269728660583 1 0 0 48.61545929836844 5.7955002005828735 3.3403290685937606 1.12231397417765 7.887580830680063 1 1 1 1 2017 "Serbia" "Serbia.2017" -.02473145102461179 1 0 0 50.54079107542444 6.556310285630537 2.0493105252801627 3.13106248590119 8.130079194227449 1 1 1 1 end
Best,
Hannes
0 Response to Use of binary explanatory (control) variables in Difference-in-Difference Estimation
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