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Re: st: combine indicator values


From   Maarten buis <maartenbuis@yahoo.co.uk>
To   statalist@hsphsun2.harvard.edu
Subject   Re: st: combine indicator values
Date   Mon, 23 Nov 2009 11:07:04 +0000 (GMT)

--- Nikolaos Pandis wrote:
> If I only enter child2 and child3 (independent variables) 
> in the model how would child1 be used as a reference for 
> child2 and child3?

Lets consider the simple case of a linear model:

y = b0 + b1 child2 + b2 child3

Now look at what happens at the three possible
scenarios:

1 kid means child2 = 0 and child3 = 0:
y = b0 + b1*0 + b2*0 = b0

2 kids means child2 = 1 and child3 = 0:
y = b0 + b1*1 + b2*0 = b0 + b1

3+ kisd means child2 = 0 and child3 = 1:
y = b0 + b1*0 + b2*1 = b0 + b2

So, b0 measure the expected value of y when
there is 1 kid, b1 and b2 measures the 
difference in y relative to the situation 
with only 1 kid. 

So leaving child1 out makes it the reference
category.

In the example below you can see that the
same logic also works in a logistic regression.

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

// create a categorical variable from dummy variables
gen marst = cond(never_married, 1,              ///
            cond(married, 2, 3))                ///
            if !missing(married, never_married)
label define marst 1 "never married"            ///
                   2 "married"                  ///
                   3 "divorced/widowed"

//set the reference category to be divorced/widowed
 char marst[omit] 3
 
// both -xi- and using the dummy variables lead to
// exactly the same results
 xi : logit union i.marst
 logit union never_married married
*----------------- end example ---------------------
( For more on how to use examples I sent to statalist see:
http://www.maartenbuis.nl/stata/exampleFAQ.html )

Hope this helps,
Maarten

--------------------------
Maarten L. Buis
Institut fuer Soziologie
Universitaet Tuebingen
Wilhelmstrasse 36
72074 Tuebingen
Germany

http://www.maartenbuis.nl
--------------------------


      

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