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From |
Maarten Buis <[email protected]> |

To |
[email protected] |

Subject |
Re: st: whether difference is significant |

Date |
Mon, 15 Oct 2012 11:31:03 +0200 |

On Mon, Oct 15, 2012 at 10:59 AM, Lynn Lee wrote: > I have two models: > > Y1=beta1*x1+beta2*x2+beta3*x3+u1 > Y2=alpha1*x1+alpha2*x2+alpha3*x3+u2 > I want to interpret whether the difference between beta1 and alpha1 is > significant. How to interpret and test this significance? How to get the > standard error for this difference? That depends. In most cases where people ask this question they actually have one model instead of two, and the problem is solved by just adding the appropriate interaction terms. For example, in the example below Y1 would be wage for whites and Y2 would be wage for blacks. Instead of two separate regression, you can estimate one model(*) with the appropriate interaction terms. Since we use a log link in this example the exponentiated coefficients are ratios not differences, so the effect of union for blacks is 1.25 times as large as the effect of union for whites (the reference) and this ratio is significantly different from 1(**). *---------------- begin example ------------------ sysuse nlsw88, clear gen black = race ==2 if race < 3 glm wage i.black##(c.grade c.ttl_exp i.union), /// link(log) vce(robust) eform *----------------- end example ------------------- (For more on examples I sent to the Statalist see: http://www.maartenbuis.nl/example_faq ) Hope this helps, Maarten (*) In this case I use -glm- to model log(E(wage)) instead of E(log(wage)), as we are typically interested in E(wage) not E(log(wage)). See: <http://blog.stata.com/2011/08/22/use-poisson-rather-than-regress-tell-a-friend/>. (**) For ratios the number 1 represents "no effect"; 1 X some number = some number. --------------------------------- Maarten L. Buis WZB Reichpietschufer 50 10785 Berlin Germany http://www.maartenbuis.nl --------------------------------- * * For searches and help try: * http://www.stata.com/help.cgi?search * http://www.stata.com/support/faqs/resources/statalist-faq/ * http://www.ats.ucla.edu/stat/stata/

**Follow-Ups**:**st: whether difference is significant***From:*"Lynn Lee" <[email protected]>

**References**:**st: whether difference is significant***From:*"Lynn Lee" <[email protected]>

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