hello dear statalisters,
I'm trying to estimate group/panel specific coefficients (particular
coefficients for each group) by means of random coefficient estimation
procedure xtrc in Stata9 (or xtrchh2 in Stata8).
The data I'm using is panel data set: 4 years, 97 groups (observations)
per year. The model I'm using is linear and defined as followed:
ln(ouput)=a+b*ln(input). Thus, the estimated coefficients could be
interpreted as elasticities and therefore range in [0;1]. What I'm
obtaining are group specific coefficients larger than 1 and/or even
negative values. Coefficients in [0;1] are really an exception. The
overall estimated elasticity is about .4. Are there any particular
distributional assumptions required? Are there any other methods, which
allow random coefficient estimation? Do you have some tip for me to
solve that problem? Thanks for any help.
P.S. Estimating group-specific coefficients by using nbreg (pooled) and
interaction dummies for every single group (97 dummies in total)
provides plausible coefficients.
with kind regards,
viktor
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