Hi Thi,
It sounds like you have two different sets of dummies - meaning that
commune dummies are not mutually exclusive of region dummies. One
dummy from each set of dummies should be dropped, but not a whole set.
The easiest way to visualize this is to add across columns, and note
if the summation is a constant - i.e. in the example below, Reg1 +
Com1 =[2,1,1,0] so they are not colinear.
e.g.
Ob Reg1 Com1 Reg2 Com2
1 1 1 0 0
2 1 0 0 1
3 0 1 1 0
4 0 0 1 1
Otherwise, there is a chance that there was an error in the coding of
the dummies.
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