Hi everyone,
I am having trouble implementing a simple least square dummy variable (LSDV) model.
The model I am implementing is the following:
reg log_wage i.vet_yes c.age i.vet_yes#c.age vetcountry female $control daustria dcanada dczechrepublic ddenmark destonia dfinland dfrance dgermany direland djapan dkorea dnetherlands dnorway dpoland dslovakrepublic dspain dsweden duk dusa [pw=weight_adjusted] , vce(robust)
In particular, vetcountry takes value of one if the country is a vocational oriented country, zero otherwise.
Now the main problem is that when running this regression stata drops two variables (dcanada and dgermany: a vocational and a general oriented country).
Am I right to believe that if the coefficients for Vetcountry is estimated, is only due to the fact that two country dummy have dropped from the model? Given that, does it mean that the coefficient estimated for Vetcountry might not be reliable? If so, do you have any suggestions on how to overcome this problem as I really need to estimate this essential independent variable?
Many thanks
Related Posts with LSDV and collinearity
Dot plot for two categorical variablesHello, I have the following dataset: clear input str1 item year1 year2 year3 year4 year5 "A" 1 0 0 …
Code for counting ID within a variableHi all, I have a variable inc_chng which calculates the changes in the income variable from year to…
Truncating long variable namesHi, Some of the variables in my dataset are too long, and trying to rename them returns an error mes…
Multiple interaction terms in panel data modelDear Statalist, First post here! I am working with a panel of exports from Spain to 170 countries.…
Interpreting values on the Y-axis in hazard functions (Survival Analysis)Hi All. The Y-axis on a survivor function is straightforward to interpret as it is denoted by 1 and…
Subscribe to:
Post Comments (Atom)
0 Response to LSDV and collinearity
Post a Comment