Nonlinear SEM models in STATA

[Krizia Garcia]

I am establishing the relationships of economic growth with corruption, government expenditure and tax revenue but the results (specifically the signs) contradict with principles --corruption (which means public output is produced P>MC) contributes to economic growth).. previous literatures also suggest nonlinearity of these relationships.. Can you even create nonlinear models using the SEM builder in STATA?

Very much hoping for a reply.. Thank you..

[Marcos Almeida]

Hello Krizia,

You may try - nlcom - and testnl - commands.

[Myles Moore]

Marcos,

Just some clarification with what you mean by trying nlcom and testnl commands when you have a nonlinear model using SEM.

If there is a non-linear transformation is required, such as x^2 or x^3, in the SEM model then would you not need to use the nlcom postestimation to get the one coefficient?

 sem (y <- x x2) nlcom _b[x]+_b[x2]

On a similar string, I am also curious how one would deal with a non-linear mediator (z) on our outcome (y), but this same mediator is linear with the other covariate (x)? I am guessing that there is an assumption here from my readings that I have missed.
e.g.

 sem (y <- z z2) (x -> z z2) *there may be no direct link between y and x. nlcom _b[y:z]+_b[y:z2]

Thanks