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From |
"Nick Cox" <n.j.cox@durham.ac.uk> |

To |
<statalist@hsphsun2.harvard.edu> |

Subject |
st: RE: log of zero |

Date |
Wed, 2 Jul 2008 11:16:04 +0100 |

Goodness knows. There are many recipes, all of them problematic. "Go out and measure it again" is the best advice! That divides sciences. In some it is regarded as self-evident, in others as possibly a strange joke. I just want to point out that far being conservative, using a very small positive value rather than zero creates outliers in terms of log of the variable in question. Using half the smallest non-zero value observed is another fudge that is not quite so objectionable. For example, consider 0, 1, 2 fudged to (1) 2^-10, 1, 2 (2) 0.5, 1, 2. Using log base 2 to convenience -- clearly the same principle applies to any other base -- you can see that logged these come to (1) -10, 0, 1 (2) -1, 0, 1 So far from being minute, any smidgen is a big deal on a log scale. Also in the "yes, I thought of that already" category is advice to try different solutions and see how much difference they make. Viktor Slavtchev I want to estimate production function in logs in order to interpret the coefficients in terms of elasticities. one of the RHS variables has a lot of zero value. in such cases, some people usually add a very small value in order to avoid the problem of 'undefined' log of zero. a similar issue was discussed some time ago among other things and in a quite different context but an interesting alternative suggestion was made (which I can't remember anymore). unfortunately, I was not able to find this particular thread. in that sence, any suggestions how to deal with the problem would be greatly appreciated * * For searches and help try: * http://www.stata.com/support/faqs/res/findit.html * http://www.stata.com/support/statalist/faq * http://www.ats.ucla.edu/stat/stata/

**References**:**st: log of zero***From:*Viktor Slavtchev <slavtchev@econ.mpg.de>

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