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st: RE: xtreg fixed effect with time trend; constant


From   "Millimet, Daniel" <millimet@mail.smu.edu>
To   <statalist@hsphsun2.harvard.edu>
Subject   st: RE: xtreg fixed effect with time trend; constant
Date   Thu, 17 Jul 2003 09:01:42 -0500

It's probably blowing up if you code the year as, say, 1999.  Then the
constant becomes the mean value of y fixing all X's at zero and time at
zero.  This is "right," just not relevant.  If you plug in the average
value of the year in the trend, you should get sensical values of y.
Alternatively, rescale the time variable to start in year 0.

Dann

----------------------------------------------------------
Daniel L. Millimet, Assistant Professor
Department of Economics
Box 0496
SMU
Dallas, TX 75275-0496
Phone: 214.768.3269
Fax:      214.768.1821
http://faculty.smu.edu/millimet
---------------------------------------------------------- 

> -----Original Message-----
> From: david reinstein [mailto:daaronr@yahoo.com]
> Sent: Thursday, July 17, 2003 4:37 AM
> To: statalist@hsphsun2.harvard.edu
> Subject: st: xtreg fixed effect with time trend; constant
> 
> I try to do an xtreg fixed effect  including a
> variable that represents the year of the data
> observation.  I assume the coefficient on this should
> be an an average time trend.  The coefficients I get
> are plausible, but the "constant" blows up weirdly --
> to a level much higher (or lower) than the average of
> the dependent variable could possibly be.
> Anyone know why?
> Anyone know how to impose a time trend (or better,
> several time trends for several subgroups) within the
> context of a panel FE model?
> Thanks,
> David
> 
> 
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