Computing Effective Tax Rates in STATA

[Jina Kemerer]

Hello,

I need to compute different effective tax rates in STATA.
Effective Tax Rates (ETRs) need to be calculated by computing a "taxes paid"/"pretax income" ratio (see image item4150 und item1401, respectively).

I need 1-year-ETRs, 5-year-ETRs as well as 10-year-ETRS
A 1-year-ETR is an ETR calculated for every single year of that firm (on the image firm names are item6001).

5-year ETRs should only include the years 1995-1999 of a specific firm (calculated by the sum of those 5 years of item4150/the sum of those 5 years of item1401)
and 10-year ETRs should include years 1995-2004 of the same firm (calculated by the sum of those 10 years of item4150/the sum of those 10 years of item1401).

I have already managed to sort firms by name and delete observations which dont have 10 consecutive firm years included using:

by item6001 (year_),sort: drop if _N<10

Thank you in advance!!

[Phil Bromiley]

You'll increase your chances of a useful answer by following the FAQ on asking questions - provide Stata code in code delimiters, readable Stata output, and sample data using dataex. Stata is also written Stata not STATA. And we generally don't like screen shots. We can't work with them so if we wanted to solve your problem, we wouldn't have the data to check our solution.

First, you'll often find programming easier if you use meaningful names instead of these item numbers. You need to read the documentation that came with Stata - start with Getting Started and the User's Guide. Clearly, you don't seem to have even got the basics. There are also books available introducing folks to Stata - check the Stata bookshop for their names.

As I understand it you want the ratio of item 4150 to 4101
g ratio= item4150/item4101

If you xtset your data, you can use lag (L.) and lead (F.) operators to calculate the over-time numbers you want and then generate the ratio.

[Jina Kemerer]

I dont really know if you want to help me or insult me - for sure nothing of what you told me is useful for me
a) Like I said, I am completely new to the programm and using it for the first time so sorry that I am spelling something wrong or not using your fancy stata language
b) English is not my mother tongue as you may have figured
c) I dont know what you are talking about when you tell me xset your data or use lag and lead (like I alreday told, I am completely new with the program) and dont have time to google every single expression or read the whole stata manual since I am working on a project that has a limited due date which unfortunately does not allow to spend days of reading manuals and learning "all the basics"
d) If you really wanted to introduce me to how things work around here i WOULD have been thankful if you'd write like a normal person and not treating me like a dumbass...which is not very nice in my opinion

So..before writing something like that..you shouldnt have had answered at all
Thanks.

[Leonardo Guizzetti]

Hello Jina. Welcome to the Statalist.

Phil's response has some good pointers in there for you. In summary, he has suggested that before asking for help, you should:

1) Please read the FAQ. Like many communities, the Statalist has a set of guidelines and expectations for those asking for help. These are not intended to hinder one's progress, but allow everyone who wishes to help to be on common ground. It's often easier for someone to help with a problem, if the person requesting help provides sufficient information on the problem, including some reproducible data and code examples.

2) It is clear that you are completely new to Stata. There are suggestions for how to get started. It will not make for a fruitful discussion if/when code is provided that you will not be able to understand.

3) In my opinion, you have acted rudely by demanding solutions to your problem. Furthermore, your post in #3 is quite defensive. If your analyses are really so time sensitive, why then would you use a completely unfamiliar package (Stata) ? Why not use something familiar, presumably Excel? Please do consider that the posters on this board are here voluntarily and are not obligated to help any particular person.

The best advice I can give is to help us to help you -- provide us some example data that we can work with, explain what the problem is and what you need, and also what you have tried or what is not working for you. Doing this increases your chances that someone will help and that you can solve your problem.