At the moment I am dealing with a apparently simple problem. The following data serves as an example: I would like to create a dummy variable that takes the value 1 if the observation of the same company (gvkey) from the previous year fulfils a certain condition. My question: How is it possible that the first observation has the value 1? Why is the panel structure not taken into account? I am aware that I can simply delete the first observation. However for a better understanding, I would like to know why Stata sets the value 1 for the first observations with this command. Interestingly, the panel structure is taken into account when I generate a lag variable (first observation is always missing which is correct).
Many thanks for your help.
Roman
Code:
xtset gvkey year
panel variable: gvkey (strongly balanced)
time variable: year, 2008 to 2010
delta: 1 unit
. gen lag = L.intcov
(6 missing values generated)
. gen dummy = 1 if L.intcov > 1
(8 missing values generated)
. list
+-------------------------------------+
| gvkey year intcov lag dummy |
|-------------------------------------|
1. | 1 2008 -1 . 1 |
2. | 1 2009 1 -1 . |
3. | 1 2010 2 1 . |
4. | 2 2008 -2 . 1 |
5. | 2 2009 3 -2 . |
|-------------------------------------|
6. | 2 2010 4 3 1 |
7. | 3 2008 5 . 1 |
8. | 3 2009 4 5 1 |
9. | 3 2010 1 4 1 |
10. | 4 2008 -1 . 1 |
|-------------------------------------|
11. | 4 2009 1 -1 . |
12. | 4 2010 1 1 . |
13. | 5 2008 -2 . 1 |
14. | 5 2009 -2 -2 . |
15. | 5 2010 2 -2 . |
|-------------------------------------|
16. | 6 2008 5 . 1 |
17. | 6 2009 -5 5 1 |
18. | 6 2010 -1 -5 . |
+-------------------------------------+
0 Response to Lagged variable and panel structure
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