Hello, everyone!

I am fairly new to Stata and I am trying to work out how to complete a DID analysis using Panel Data. My data set contains 12 countries in a Panel Data format between 1980 and 2015. For each country, I have a list of observed variables over the time period.

During the time series, a policy change is implemented within 3 of the 12 countries (2004). I would like to use these 3 countries as a treatment group and the remaining 9 as the control group.

I have included three treatment variables that take the following values:

In order to determine the significance of the policy change, I would like to use the DID approach. I constructed a panel data regression with the following command:

(Population, Unemployment, Avg_Month_Wage are observed variables within the data set.)

STATA produces the results and the coefficients on my explanatory variables seem legitimate. However when interpreting the coefficient on the TreatPost variable to conclude the DID estimate it seems unrealistically large. Is this a question of me interpreting the coefficient incorrectly or is there something wrong with my setup.

Any help would be greatly appreciated.

Many thanks,

I am fairly new to Stata and I am trying to work out how to complete a DID analysis using Panel Data. My data set contains 12 countries in a Panel Data format between 1980 and 2015. For each country, I have a list of observed variables over the time period.

During the time series, a policy change is implemented within 3 of the 12 countries (2004). I would like to use these 3 countries as a treatment group and the remaining 9 as the control group.

I have included three treatment variables that take the following values:

Code:

Treatment Variable IndicatorsTreat1 if unit of observation is Treated Unit 0 if unit of observation is Control Unit Post1 if period is post-treatment 0 if period is pre-treatment TreatPost (Treat * Post)1 if unit is treated and in post-treatment period 0 otherwise

In order to determine the significance of the policy change, I would like to use the DID approach. I constructed a panel data regression with the following command:

Code:

xtreg W_Trade_M Treat Post TreatPost Population Unemployment Avg_Month_Wage, re

Code:

------------------------------------------------------------------------------- W_Trade_M | Coef. Std. Err. z P>|z| [95% Conf. Interval] --------------+---------------------------------------------------------------- Treat | 2.17e+10 3.05e+10 0.71 0.476 -3.80e+10 8.15e+10 Post | 1.13e+10 5.41e+09 2.08 0.037 6.65e+08 2.19e+10 TreatPost | 9.14e+10 7.40e+09 12.35 0.000 7.69e+10 1.06e+11 Population | 1863.556 605.2821 3.08 0.002 677.2246 3049.887 Unemployment | -3.82e+09 8.54e+08 -4.48 0.000 -5.49e+09 -2.15e+09 Avg_Month_W~e | 2.21e+07 2943090 7.52 0.000 1.64e+07 2.79e+07 _cons | 6.64e+09 2.17e+10 0.31 0.759 -3.59e+10 4.92e+10 --------------+---------------------------------------------------------------- sigma_u | 4.186e+10 sigma_e | 2.315e+10 rho | .76576531 (fraction of variance due to u_i) -------------------------------------------------------------------------------

Any help would be greatly appreciated.

Many thanks,

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