I am trying to calculate the EGI (Ellison and Glaeser's index of geographical concentration) using the STATA module developed by Jay Dev Dubey. I have a query regarding the formula used. The help file on the module states the following:
Ellision and Glaeser's index
EGIi = (GIi - HIi)/(1-HIi)
where, GIi = Sum of squared deivation of ith industry's state employment share from
a measure Ss.
Ss = employment share ith state in the average industry.
Hi = Herfindhal style measure of the plant level concentration of employment in ith
industry.
EGI syntax return and store the Ellision and Glaeser's index for each industry variety
as a new variable. By choosing suitable index option it may also return other components.
Option
However, the 1997 paper has the following formula,
Array
From what I am understanding, the EGI module on STATA is missing the following.
Array
Just wanted to check if my understanding is correct here, or whether the EGI STATA module is correct.
Thanks!
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