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From |
Maarten buis <maartenbuis@yahoo.co.uk> |

To |
statalist@hsphsun2.harvard.edu |

Subject |
Re: st: Chow test as a solution for testing of equality of coefficients across two separate samples. |

Date |
Tue, 22 Jun 2010 12:06:15 -0700 (PDT) |

--- On Tue, 22/6/10, natasha agarwal wrote: > I wanted to test the equality of a coefficient across two > different groups namely developed and developing. > > So for example when I estimate > > xtreg lnrval lnk lnw lnvfdi lnvfdi*D y14-y18, fe > vce(robust) > > where D=1 if developed and zero otherwise. > > a significant coefficient on lnvfdi*D will tell me the > difference in the impact of FDI when the country is developed. > > But can one conclude that coeffcient on lnvfdi minus > coefficient on lnvfdi*D is the actual impact of FDI when country is > developed? First of all you need to include D as a covariate. The coeficient of lnvfdi is the effect of lnvfdi in developing countries The coefficient of lnvfdi*D is the difference in effect of lnvfdi in developing and developed countries The effect of lnvfdi in developed countries is thus the sum of the coefficients of lnvfdi and lnvfdi*D See, e.g.: http://www.stata.com/statalist/archive/2005-02/msg00779.html Hope this helps, Maarten -------------------------- Maarten L. Buis Institut fuer Soziologie Universitaet Tuebingen Wilhelmstrasse 36 72074 Tuebingen Germany http://www.maartenbuis.nl -------------------------- * * For searches and help try: * http://www.stata.com/help.cgi?search * http://www.stata.com/support/statalist/faq * http://www.ats.ucla.edu/stat/stata/

**Follow-Ups**:**Re: st: Chow test as a solution for testing of equality of coefficients across two separate samples.***From:*natasha agarwal <agarwana2@googlemail.com>

**References**:**st: Chow test as a solution for testing of equality of coefficients across two separate samples.***From:*natasha agarwal <agarwana2@googlemail.com>

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