Notice: On April 23, 2014, Statalist moved from an email list to a forum, based at statalist.org.

[Date Prev][Date Next][Thread Prev][Thread Next][Date Index][Thread Index]

From |
David Hoaglin <dchoaglin@gmail.com> |

To |
statalist@hsphsun2.harvard.edu |

Subject |
Re: st: Regression question |

Date |
Fri, 25 May 2012 23:37:37 -0400 |

Hi, Mike. I may not understand the structure of your data, but it seems that the explanatory variable that you denote by X2(ij) is actually several related variables. That is, in your example, j seems to index the various media (j = 1 for TV, j = 2 for Newspaper, etc.). In that situation, you should treat each of the media as a separate explanatory variable, with its own regression coefficient. You might learn from the analysis that those coefficients are essentially equal, in which case the interpretation would be that what matters is the total amount of AD spending. Then you could simplify the model by using total AD spending as the explanatory variable, instead of the amount spent on each of the types. It seems more likely, however, that the coefficients for the types of media will differ. In interpreting the regression coefficients, please keep in mind that the set of other explanatory variables in the model is part of the definition of each coefficient, and that each estimated coefficient reflects the contribution of its explanatory variable after adjusting for the contributions of the other explanatory variables. I hope you are planning to make plots of the data and use various regression diagnostics to spot influential observations. David Hoaglin On Fri, May 25, 2012 at 9:52 AM, Mike Kim <kalisperos@gmail.com> wrote: > Hi all, > > This question is not about Stata, but I would appreciate your opinion. I > wonder whether the following regression (e.g., OLS) makes sense. > > Y(i) = b0 + b1*X1(i) + b2*X2(ij) + e(i) > That is, Y varies by i, but some independent variables vary by i and j. Each > Y(i) is repeated j times, so data structure is: > > Y X1 X2 > 10 2 1 > 10 2 2 > 10 2 3 > 20 3 4 > 20 3 5 > ... > > For example: > i: company, j: adverting spending by media (TV, Newspaper, etc.) > REVENUE(i) = b0 + b1*R&D SPENDING(i) + b2*AD SPENDING BY MEDIA(ij) + e(i) * * 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: Regression question***From:*"Mike Kim" <kalisperos@gmail.com>

**References**:**st: Regression question***From:*"Mike Kim" <kalisperos@gmail.com>

- Prev by Date:
**Re: st: Error r(103) after gengroup command** - Next by Date:
**st: ivreg2** - Previous by thread:
**st: Regression question** - Next by thread:
**RE: st: Regression question** - Index(es):