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st: Interpretation of transition probabilities


From   "Pavlos C. Symeou" <p.symeou@gmail.com>
To   statalist@hsphsun2.harvard.edu
Subject   st: Interpretation of transition probabilities
Date   Tue, 28 Dec 2010 21:26:54 +0200

Dear Statalisters,

Season's greetings.

I am working on the modeling of an ordered variable "projects" which takes values from 0-6 denoting the number of construction projects undertaken by a construction firm during a year. I want to tell a few things about the probability of change in the number of projects undertaken by the sample firms over time. I have observations for 100 firms over the period 1991-2008 and I use the -xttrans- command which gives me the following table. As far as I understand, referring to the second column, 90% of those firms with zero projects in one year have a chance of 16% to get one project in the next year. What I don't understand is what the last row "Total" tells.


projects

	

0

	

1

	

2

	

3

	

4

	

5

	

6

	

Total

0

	

90.47

	

8.76

	

0.69

	

0.09

	

0

	

0

	

0

	

100

1

	

16.07

	

70.03

	

12.97

	

0.93

	

0

	

0

	

0

	

100

2

	

2.07

	

16.99

	

69.28

	

11.52

	

0.15

	

0

	

0

	

100

3

	

1.7

	

2.38

	

18.37

	

70.41

	

7.14

	

0

	

0

	

100

4

	

1.96

	

0

	

3.92

	

21.57

	

66.67

	

5.88

	

0

	

100

5

	

0

	

0

	

0

	

0

	

11.54

	

84.62

	

3.85

	

100

6

	

0

	

0

	

0

	

0

	

0

	

50

	

50

	

100

Total

	

58.03

	

22.83

	

12.3

	

5.34

	

1.01

	

0.45

	

0.03

	

100



I hope you can verify my interpretation and enlighten me about the last row.

Best wishes and happy new year,

Pavlos

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