debt thresholds

[Joachim Vanderheyden]

Hi everyone

I have already done the following fixed effects regression:
xtreg labor productivity; debt rate; turnover; employees; labor intensity; net added value; debt; labor cost

Now I want to investigate from wich debt rate the labor productivity will start decreasing.
I know that I need to implement debt tresholds but wich commands do I have to insert?

Thanks in advance.

[Clyde Schechter]

It appears that the material beginning with -xtreg- in your post is pseudo-code, not real code. (Real code would not have semi-colons, and variable names can't contain blank spaces.) So it is hard to know just how well what you wrote reflects the actual model you ran. But assuming it is somewhat faithful, your model is not suitable for this research question. Having modeled labor productivity as linear in debt rate, there is no turning point. It will either be an always increasing or always decreasing function of debt rate (except in the very rare case where the coefficient is zero, meaning that labor productivity is independent of debt rate.)

If it is your expectation that labor productivity sometimes increases with debt rate and sometimes decreases with debt rate depending on the value, then you need a different, non-linear, model.

[Marcos Almeida]

Welcome to the Stata Forum / Statalist,

Stata 15.1 has threshold regression available. Perhaps this text may be helpful to you.

[Joachim Vanderheyden]

That was just to make the variables more clear.

I want to know for which debt rate, the effect on productivity is the highest. I have the following classifications:
Debt rate: 0-24,99%
25 - 49,99%
50 - 74,99%
75 - 99,99%
100 - ... %

I will try to find it in that text Mr Almeida.

Thank you for the support.

[Joachim Vanderheyden]

I have only stata version 12.1 available at school. How can I implement thresholds in that Stata version?

[Nick Cox]

Short answer: Whatever is part of Stata 15 can't be run by you unless you or your school upgrades to Stata 15.

[Joachim Vanderheyden]

I understand that, but my supervisor says that it is possible to implement debt thresholds in the Stata version 12.1. However, the problem is that I can not find the way this should happen.

[Nick Cox]

Your supervisor may be right, but perhaps you need to ask him or her what they had in mind. There can be an enormous gap between hoping or imagining that something is possible in Stata and knowing how to do it.

This thread was opened in December 2018 and threshold seems the one concrete suggestion in 3 months. This isn't my field, and I can't advise further in detail.

You may need a different title to ask again. Perhaps other people are using the method you want but the keyword "Debt" didn't trigger a reaction. I am very active here but routinely ignore most posts with what seem from the titles to be very subject-specific questions.

[Joachim Vanderheyden]

Thank you for your advice. I will open a new ticket without the keyword "debt".