Hi all,

I am looking to create a regression to determine the relationship between large increases in Cost-of-living and the number of divorces. My dependent is the natural log of the new number of divorces, and my dependent is a dummy variable where 1 is an inflation rate of anything greater than 3% and 0 is anything less than. My controls are the income of couples, population and the female labour force participation rate. My regression is in 10 Canadian Provinces, numbered 1 through 10 (instead of using province names) and from the years 1979-2003. I am looking to include fixed effects for both province and year but am not sure what code to use. I also want to cluster at the province level. Currently this is the code I have.

Code:

xtset Province Year
xtreg lnDivorces InflationTarget CouplesIncome Population FemaleLFPR i.Year , fe vce(cluster Province)

When I try to include i.Province, it says that it was omitted due to collinearity. Is my code correct, or how can I write it such that I include fixed effects for both province and year, as well as clustering the standard errors at the province level.

Thanks,

Paige