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RE: st: RE: RE: estimation with a time trend.


From   "Nick Cox" <n.j.cox@durham.ac.uk>
To   <statalist@hsphsun2.harvard.edu>
Subject   RE: st: RE: RE: estimation with a time trend.
Date   Mon, 5 Jul 2010 14:01:33 +0100

Your original question was 

"I was trying to estimate a production function with an unbalanced
firm-year panel data and wanted to include a time trend. However I was
not sure if the time trend was created correctly.

egen t=group(year)

I was wondering if anyone could please tell me if this was correct?"

Who knows whether the commands you are using "mean center" the data if
you do not tell us what they are? 

Nick 
n.j.cox@durham.ac.uk 

natasha agarwal

On Mon, Jul 5, 2010 at 1:14 PM, Maarten buis <maartenbuis@yahoo.co.uk>
wrote:

> --- On Mon, 5/7/10, natasha agarwal wrote:
>> I am afraid I did not understand "year- (or -year-
>> MINUS> midpoint) for interpretability?"
>
> Say you have a variable representing year of birth
> ranging between 1910 and 1980. I would then usually
> have a line like this in my do-file:
>
> gen c_year = year - 1910
>
> Afterwards I would use c_year instead of year. In
> this case "midpoint" is 1910, and makes sure that
> your new variable is shifted to the left such that
> it has the value zero in 1910. This makes sure
> that the baseline in your models refer to a point
> at the beginning of your observed period. This is
> particularly important if you include interactions
> or if you care about the constant (e.g. in a random
> effects model)

I am estimating the model with a within estimator. I thought that they
mean center the data anyways?


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