Stata can run this regression: reg Y X1 i.X1#c.X2 i.X2. However, while a coefficient is calculated for both X1 and i.X1#c.X2, margins is for some reason unable to obtain the marginal effects of X1 over X2.
I have had this problem several times, and right now I'm having this problem in a situation where I have other fixed effect accounted for, and so am using xtreg. However, the problem is generalizable to a situation where one is using reg only. I have replicated the problem in the auto dataset, below, and would be incredibly grateful for thoughts on what's going on.
Code:
sysuse auto, clear xtset foreign gen lprice=log(price) gen HIGHmpg=mpg>25 ** Reg 1: This works fine xtreg lprice i.HIGHmpg i.turn margins, dydx(i.HIGHmpg) ** Works fine w/ no interaction ** Reg 2: This does not work xtreg lprice i.HIGHmpg i.HIGHmpg#c.turn i.turn margins, dydx(i.HIGHmpg) at(c.turn=(32 36 40 44 48 52)) /* Command does not run. Error returned: c.turn ambiguous abbreviation r(111); */ ** Reg 3: This "trick" also doesn't work gen test=turn xtreg lprice i.HIGHmpg i.HIGHmpg#c.test i.turn margins, dydx(i.HIGHmpg) at(c.test=(32 36 40 44 48 52)) /* Command runs, but interactions deemed "not estimable" */ ** Reg 2 w/ reg instead of xtreg reg lprice i.HIGHmpg i.HIGHmpg#c.turn i.turn margins, dydx(i.HIGHmpg) at(c.turn=(32 36 40 44 48 52)) ** Same error given ** Reg 3 w/ reg instead of xtreg reg lprice i.HIGHmpg i.HIGHmpg#c.test i.turn margins, dydx(i.HIGHmpg) at(c.test=(32 36 40 44 48 52)) ** Interactions still deemed "not estimable" ** Note: it is possible to allow an interaction between i.HIGHmpg and EVERY ** value of test, as below, but this is not what I want to do, as it wastes power. ** In my own examples, it is helpful to do this because I can see a linear or ** non-linear pattern in the marginal effects, but then I ultimately want to run ** the model allowing only a continuous change in the marginal effects. xtreg lprice i.HIGHmpg i.HIGHmpg#i.turn i.turn margins, dydx(i.HIGHmpg) over(i.turn)
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