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From |
kiran javaid <kiranjavaidr@gmail.com> |

To |
statalist@hsphsun2.harvard.edu |

Subject |
st: Interpreting Polychoric PCA results in STATA 11 |

Date |
Mon, 8 Aug 2011 13:56:41 +0500 |

Hello everybody, I want to form a wealth index at household level by using variables like housetype(mud=1, bricks_mud=2, bricks_cement=3), household owner (rented=1 owned=2), electricity (no=0, yes=1), mobilephone (range is from 0 - the number of mobile phones a household has, for my sample, the maximum is 13), cycles (no cycle=0, yes cycle = 1,2,3... the number of cycles owned) etc. As the variables are categorical I should use polychoric pca instead of simple pca, right? One question I have is that if i use polychoric pca then do i need to generate a seperate variable for each category of these variables? for instance, in the household type category, should i have one variable as housetype_mud (mud house=1, not mud house=0), then another as housetype_bricks_mud (bricks_mud house=1, not bricks_mud house=0) and similarly for bricks_cement? but then i would have to leave one category out to avoid multicollinearity, right? Furthermore, if this is the case then what happens to the mobile phone and cycle variables? Do i still have just one variable for mobile phone (going from 0 to 13) and one for cycle as it currently is? Secondly, the command i'm using for polychoric pca is: polychoricpca housetype houseowner electricity mobilephone cycle, score(index) nscore(3) (ofcourse, if i need to generate seperate variables for all categories then those will replace housetype, houseowner...) My question is that this one command will give me the factors generated? Since i typed nscore (3), it will give me 3 factor components. However, the eigenvalues are greater than 1 for only 2 factor components. So in order to get one composite index (wealth index) i should multiply index1 with the eigenvalue for index1, and index2 with eigenvalue for index2 and then add these two up? like we do in simple pca? Any and all help will be greatly appreciated. - Kiran * * 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: Interpreting Polychoric PCA results in STATA 11***From:*Stas Kolenikov <skolenik@gmail.com>

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