Hello,
I am using Stata 14.
I have an unbalanced panel data set. I am using -mixed- to estimate fixed and random effects.
I have to estimate elasticities and I am using a log-log approach for my model:
log(DV)= (B0+B0i) + (B1+B1i) *ln(V1)it + (B2+B2i) *ln(V2)it + (B3+B3i) *ln(V3)it + (B4+B4i) *ln(V4)it + Ui + Eit
The independent variables mostly take on positive values or maybe zeros. The DV is a financial variable (return on sales) that can take on positive, negative or zero value (countable few zero values). I read about neglog transformation through this forum and tried to use it for my DV i.e. return on sales. Given the histogram of my DV, I gather neglog to be a good option.
My question is regarding interpretation of the results when DV is a neglog variable. In a general log-log model case, I would interpret, say for independent variable V1, a 1% increase in V1 is associated with a B1 percent change in DV. How do I interpret when I do a neglog transformation?
Source used for neglog:
http://fmwww.bc.edu/repec/bocode/t/transint.html
Thank you!
I am using Stata 14.
I have an unbalanced panel data set. I am using -mixed- to estimate fixed and random effects.
I have to estimate elasticities and I am using a log-log approach for my model:
log(DV)= (B0+B0i) + (B1+B1i) *ln(V1)it + (B2+B2i) *ln(V2)it + (B3+B3i) *ln(V3)it + (B4+B4i) *ln(V4)it + Ui + Eit
The independent variables mostly take on positive values or maybe zeros. The DV is a financial variable (return on sales) that can take on positive, negative or zero value (countable few zero values). I read about neglog transformation through this forum and tried to use it for my DV i.e. return on sales. Given the histogram of my DV, I gather neglog to be a good option.
My question is regarding interpretation of the results when DV is a neglog variable. In a general log-log model case, I would interpret, say for independent variable V1, a 1% increase in V1 is associated with a B1 percent change in DV. How do I interpret when I do a neglog transformation?
Source used for neglog:
http://fmwww.bc.edu/repec/bocode/t/transint.html
Thank you!
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