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st: re: 3SLS and fixed effects

From   Kit Baum <>
Subject   st: re: 3SLS and fixed effects
Date   Thu, 23 Jul 2009 11:29:50 -0400

mmolina said

After adding the sector dummies I have problems of endogeneity. Should I suppose that this fact invalidate the model? Or should I conclude that I need more information to control for sector effects? Is it better to work with other command tha reg3? Thanks again Nothing stops you from creating the dummies and adding them to the regression, especially as you only have 8 (or 7) of them...

Well, as 3SLS is an estimator that takes care of endogeneity by using instruments, why should that be a problem?

Kit Baum   |   Boston College Economics & DIW Berlin   |
An Introduction to Stata Programming |
   An Introduction to Modern Econometrics Using Stata  |

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