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st: ivregress with quadratic term!


From   FredVer <[email protected]>
To   [email protected]
Subject   st: ivregress with quadratic term!
Date   Wed, 16 May 2012 12:11:40 -0700 (PDT)

Dear all,

For my ivregress gmm estimation i use allow for a nonlinear relationship
between my indep variable (lerner index) and the dependent variable. this
variable is btw also the endogenous variable which is instrumented.

Therefore my question, to generate the quadratic term is: gen lerner_new =
lerner^2. This is correct right?

I've included it in the regression in the following way: 

ivregress gmm depvar lerner_new var var (endog = instr instr), vce(cluster
councode) first

Now, in the output table from the table i follow they give the inflection
point...how to do it? Because when I now include the quadratic term, the
results get worse (significance down!) compared to the linear regressions
results.

If someone could help! I've already searched on inflection point, but no
results I could use.

Thanks

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