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Re: st: how to interpret interaction effects in negative binomial model


From   Maarten buis <maartenbuis@yahoo.co.uk>
To   statalist@hsphsun2.harvard.edu
Subject   Re: st: how to interpret interaction effects in negative binomial model
Date   Tue, 23 Mar 2010 01:08:48 -0700 (PDT)

--- On Tue, 23/3/10, WANG Shiheng wrote:
> I have a question about how to interpret the interaction
> items in negative binomial regression.
> 
> In the following model “post” is a dummy variable (0 or
> 1) to indicate two different periods (0 represents the 
> first period, 1 represents the second period).  
> “treatment” is a dummy variable (0 or 1) to indicate two
> different groups –“treatment sample”(1) vs. “control 
> sample” (0). The interaction is the product of the two
> dummies. The dependent variable is the number of analysts.
<snip>
>               coef       se
> post          .0610886  .0743914     
> treatmen     -2.975135  .1591135 
> post*treatment .214007  .0730457

I would analyse these results in terms of incidence rate 
ratios, by adding the -irr- option. You can do it also by
hand, by computing irr = exp(coef) (but why do it yourself
if Stata can do it for you?). The basic logic behind this
type of interpretation of interaction terms in non-linear
models is discussed here:
http://www.maartenbuis.nl/wp/interactions.html

To come back to your case:

The expected number of analysist in the non-treatment group
increases by a factor exp(.061)= 1.06 (i.e. 6%) when a firm
went from the pre-period to the post-period. This ratio is
however not significant. [1]

This effect of post increases by a factor of exp(.214) = 
1.24 (i.e. 24%) if the firm is in the treatment group. This
change in effect is significant. [1]

The expected number of analysists in the pre-period group 
changes by a factor of exp(-2.975) = .05 (i.e. a change of
-95%) when a firm receives the treatment. This effect is 
significant. [1]

This effect of treatment changes by a factor of exp(.214) =
1.24 (i.e. the effect becomes 24% less negative) in the 
post-period. This effect is significant. [1]

Hope this helps,
Maarten

[1] It may come as a surprise that I use the test that 
coef = 0 to test the hypothesis that exp(coef) = 1. The 
logic behind this choice is discussed here:
http://www.stata.com/support/faqs/stat/2deltameth.html

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

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



      

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