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  • Generating a Financial Inclusion Index

    Hello everyone, I am in dire need of your help, I am trying to generate a Financial inclusion index for 80 countries. I have four variables. I am not proficient at Stata so I would appreciate if anyone could help me with which approach should I take to generate the index. I have data from 2004-2017. Thanks in advance.

  • #2
    I recommend you look to the relevant literature to investigate what others have done. Generally speaking, however, you might consider various approaches such as taking the average of the four variables or using a principal component analysis (PCA) to see which (if any) of the variable have an underlying relationship. Type 'help pca' in Stata to learn more about such an approach.