# Re: st: Re: IV and fixed effects

 From Jianhui Li To statalist@hsphsun2.harvard.edu Subject Re: st: Re: IV and fixed effects Date Mon, 09 May 2005 10:36:10 -0300

```Thank you guys for the help!

Mark: This is a survey data. every observation represents a certain number of
persons in the population. all the weights in the dataset addup to the whole
population. So the pweight is the weight I will use, isn't it?

Kit: Do I need to consider the weights while I am doing the demeaning? ie. when
I calculate the mean of a variable, should I use the sum of variables divided by
the number of oberservations, or should I use the sum of the products of the
variable and weight, then divide the sum by the total weights? I hope I've made
myself clear.

-----------------------------------------------------
Jianhui Li <colasonic@gmail.com>

Quoting mail from "Mark Schaffer" <M.E.Schaffer@hw.ac.uk> at Mon, 09 May 2005 12:26:14 +0100

Subject: Re: st: Re: IV and fixed effects

> Just to follow up on Kit's email,
>
> From:           	Kit Baum <baum@bc.edu>
> Subject:        	st: Re: IV and fixed effects
> Date sent:      	Mon, 9 May 2005 07:11:47 -0400
> To:             	statalist@hsphsun2.harvard.edu
>
> > Presumably you have too many fixed effects to implement directly. But
> > you can always apply the demeaning transformation "by hand" to each
> > variable--that is, by unit, express each variable as a deviation for
> > the unit's mean--and then apply any appropriate estimator to the
> > transformed variables. That is all that the xtivreg,fe estimator (or
> > any estimator of the LSDV model, such as xtreg, fe or areg) is doing
> > anyway. The egen mean function (which supports the bys unit: prefix)
> > may be useful in doing this demeaning transformation.
>
> Ben Jann's -center- will do this very nicely, with a casewise option
> and support for aweights.  Dealing with weights might be a bit
> tricky, though - is it simply a case of demeaning using weighted
> means?  If so, aweights is good enough.
>
> --Mark
>
> >
> > Kit Baum, Boston College Economics
> > http://ideas.repec.org/e/pba1.html
> >
> > On May 9, 2005, at 2:33 AM, Juanhui wrote:
> >
> > > My survey data requires me to run fixed effect OLS regression with
> > > instrumental
> > > variables. However, xtivreg doesn't support weights. ivreg doesn't
> > > support fixed
> > > effects and areg doesn't support iv. Is there any way to combine them
> > > together
> > > and get me finish my thesis?
> >
> > *
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>
> Prof. Mark E. Schaffer
> Director
> Centre for Economic Reform and Transformation
> Department of Economics
> School of Management & Languages
> Heriot-Watt University, Edinburgh EH14 4AS  UK
> 44-131-451-3494 direct
> 44-131-451-3296 fax
> http://www.sml.hw.ac.uk/cert
>
> *
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*
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```