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Re: st: Re: Adding the marginal effects at individual values of

From   Christopher Baum <>
To   "Solomon Tesfu" <>
Subject   Re: st: Re: Adding the marginal effects at individual values of
Date   Mon, 22 Feb 2010 13:30:35 -0500

As I said in an earlier message, you can do this on a fine grid. Multiply the variable of interest by 10 and it will range from -60 to +60, and you can step through those 120 integers and calculate AMEs for each of them, corresponding to the original variable evaluated at -6.0, -5.9, -5.8, ...

I suggest making integer-valued 'buckets' out of this to make exact comparisons hassle-free.

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

On Feb 22, 2010, at 1:09 PM, Solomon Tesfu wrote:

Thanks again for your helpful suggestions . When I said the AME does not show the variations in the ME at various levels of the regressor I was refering to the AME calculated using the entire set of observations. Yes, I can see the pattern in the AME by calculating it for successively increasing intervals of the observed values of the regressor. But my undertanding of the syntax you suggested was that it calculates the MEs at only integer points (not the AMEs for intervals of values) and adds them to the data as an additional variable. The observed values of my variable of interest range between -6 and 6 and the sample size is 2400. If I round off all the observed values to the nearest integers and calculate the MEs only at integer points that will still be informative but will hide some details. Anyway, I think I have sufficient inputs from you guys and I'll work on it.


Kit Baum <> 02/22/10 7:27 AM >>>
On Feb 22, 2010, at 2:33 AM, Solomon wrote:

Thanks again Kit and Richard, for your ideas. I understand that I cannot talk about precision of the estimates at each point of observation but once I get the estimates I can plot them against the values of the variable and look at the pattern. This is important because I have a reason to believe that the marginal effects will be different at high and low values of the regressor and the AME or the marginal effect at mean do not help me to verify this possibility.

I don't see, then, how calculating AMEs at various points in the regressor space would not 'verift this possibility'. If you take the continuous variable you have and 'bin' it into ranges---which can be as many as you can handle, given matsize---you can calculate the AMEs at very-very-low, very-low, low, low+, low++, low+++, etc. values of that regressor. Depending on your sample size and the capacity of Stata (e.g., Stata/SE or Stata/MP can handle larger matrices) you could calculate AMEs on a very fine grid of values of the regressor, and 'look at the pattern'. Why does this not answer the question you'd like to pose to the data?

If AMEs differ across levels of income, I don't need to use an income of $54,321 to verify that. An income of $55,000 would work, as long as its AME is clearly distinct from that of income = $5,000.

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

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