For replicating a paper, I have chosen 2 variables, cash divided by total assets and economic policy uncertainty index (EPU).
I have the following descriptive statistics for the above 2.
Code:
summarize cash_ta_w epu Variable | Obs Mean Std. Dev. Min Max -------------+-------------------------------------------------------- cash_ta_w | 31696 .0545121 .0756915 .0006936 .4169685 epu | 30566 93.8854 39.70486 49.4826 185.465
Code:
. xtreg cash_ta_w L.epu,fe Fixed-effects (within) regression Number of obs = 25801 Group variable: id Number of groups = 2868 R-sq: within = 0.0002 Obs per group: min = 1 between = 0.0015 avg = 9.0 overall = 0.0000 max = 16 F(1,22932) = 5.31 corr(u_i, Xb) = -0.0073 Prob > F = 0.0212 ------------------------------------------------------------------------------ cash_ta_w | Coef. Std. Err. t P>|t| [95% Conf. Interval] -------------+---------------------------------------------------------------- epu | L1. | .0000175 7.61e-06 2.31 0.021 2.63e-06 .0000325 | _cons | .0533294 .0007907 67.45 0.000 .0517795 .0548792 -------------+---------------------------------------------------------------- sigma_u | .06317561 sigma_e | .04796038 rho | .63438748 (fraction of variance due to u_i) ------------------------------------------------------------------------------ F test that all u_i=0: F(2867, 22932) = 14.52 Prob > F = 0.0000
Question-2: Also can I interpret this as One standard deviation increase in Lagged EPU, on an average produces a, .0694835% (.0000175* 39.70486*100) increase independent variable?
Question-3 : Is there any transformation/change applicable to make the results more appealing to a general audience
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