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st: interpreting distribution of theta in xtreg ,re theta

Subject   st: interpreting distribution of theta in xtreg ,re theta
Date   Tue, 07 Apr 2009 10:23:28 +0200

Hello everybody,

Can somebody please help me with the following rather beginner problem of mine. Using STATA 8 I have computed couple of Regressions estimating Random effects usng xtreg ..., re theta which delivers the distribution of theta as well. From the STATA Manual I have understood that theta is an important component in estimating random effects, but I am not sure how to interpret the distribution in other words what is the optimal distribution and are there some distributions which could question the whole regression result?

Thank you in advance for any comments and insight.


Jakub Orsag
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