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st: Re: Does your academic discipline use logit regressions with interaction terms?


From   "Ada Ma" <ada_ma2001@hotmail.com>
To   <statalist@hsphsun2.harvard.edu>
Subject   st: Re: Does your academic discipline use logit regressions with interaction terms?
Date   Thu, 22 Aug 2002 11:52:22 +0100

Eric wrote:
> Unfortunately, the estimated
> coefficient for the interaction term (and its statistical significance)
> depends not just on the true underlying sensitivity of turnover to
> performance, but on the difference in the average likelihood of
> turnover between the two types of firms.

I think you need not worry about the sensitivity of turnover to performance
and its difference from the average likelihood of turnover due to firm
types.  That's because the inclusion of the type dummies in your estimation
is already controlling for that.  So you are estimating how badly a
particular firm is performing with reference to how badly the whole industry
(or firm type) is performing.  You might want to include a variable to
control for the market's overall performances as well.

> 1) Is that particular form of logit or probit regression typical in your
> field?  If so, can you give me some references?

Quite typical, I use it to estimate the probability of promotion within the
internal labour market of a large firm.

> 2) Have you seen this statistical issue addressed in a paper, textbook,
> etc? If so, can you give me some references.

Hmmmm... guess there are many other people on the list who are much wiser
than me on this topic.

 Ada Ma
ada_ma2001@hotmail.com
PhD Student in Economics at University of Newcastle upon Tyne (UK)

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