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Re: st: log of zero


From   Maarten buis <maartenbuis@yahoo.co.uk>
To   statalist@hsphsun2.harvard.edu
Subject   Re: st: log of zero
Date   Wed, 2 Jul 2008 11:29:37 +0100 (BST)

--- Viktor Slavtchev <slavtchev@econ.mpg.de> wrote:
> 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.

I think you are refering to using -glm- with the log link, like in the
example below. 

*----------- begin example ----------------
sysuse nlsw88, clear

/* create some zeros */
recode grade 0/11 = 0

gen lnage = ln(age)
xi: glm grade lnage i.race south, link(log)
*----------- end example ------------------
(For more on how to use examples I sent to the Statalist, see
http://home.fsw.vu.nl/m.buis/stata/exampleFAQ.html )

When searching the archive of Statalist it may be helpful to know that
in the archive of the statalist hosted by StataCorp there is a good
search function, see: http://www.stata.com/statalist/archive/

Hope this helps,
Maarten

-----------------------------------------
Maarten L. Buis
Department of Social Research Methodology
Vrije Universiteit Amsterdam
Boelelaan 1081
1081 HV Amsterdam
The Netherlands

visiting address:
Buitenveldertselaan 3 (Metropolitan), room Z434

+31 20 5986715

http://home.fsw.vu.nl/m.buis/
-----------------------------------------


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