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st: Mean Correction


From   "Pavlos C. Symeou" <p.symeou@jbs.cam.ac.uk>
To   statalist@hsphsun2.harvard.edu
Subject   st: Mean Correction
Date   Tue, 11 Sep 2007 10:36:24 +0100

Dear Statalisters,

In many papers authors appear to mean-correct variables prior to 
estimation for certain reasons. Namely, they divide the respective 
variables by their geometric means. However, in a panel data environment 
this raises the question "Which geometric mean should I use?". Should I 
divide my variables with a Country-specific geometric mean (using 
"bysort country"); should I use Yearly-specific geometric mean (using 
"bysort year"); or a pooled geometric mean for all years and countries?

Thank you.

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