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Re: st: Constant in a within transformation

From   [email protected]
To   [email protected]
Subject   Re: st: Constant in a within transformation
Date   Tue, 14 Oct 2003 12:00:50 -0400

The constant appears because the way Stata does the within transformation is not

Yit - YBARi,

where YBARi is the average of Yt in group i,

but Yit - YBARi + YBARit,

where YBARit is the average Y over time and across groups. Hence, a constant
will show up again.

Hope this helps.



the stata command

xtreg ... , fe i(...);

uses a within transformation, which means that all the fe-dummy variables
disappear and also a constant. In the output of this function, stata still
rapports a constant coefficient. How is this calculated?

Randy Brenkers

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