Coding probit for predicting recessions

[Juan Noriega]

Hello everyone!!

I'm trying to finish my masters' thesis but I'm having trouble writing my regressions in Stata. One of my regressions is trying to predict recessions in the next periods. It is:

My problem is in the left hand side of the equation. I want to calculate the probability of a recession (which is represented by a dummy equal to 1) in the next 4 periods if any of the periods t+1 up to t+4 is a recession period. I can't find any codes for this.

I appreciate any help!!!!

Thanks,

Juan

[Phil Bromiley]

You didn't get a quick answer. 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. You'll find this kind of work easier if you first xtset your data.

Knowing what your data looks like is essential. You can generally specify such a dummy with something like:

g recession=(F.GDP<GDP)

But the rhs of this depends on how you're defining a recession, which you don't tell us.