Hello,
I am running a panel data analysis to examine the effect of Geographic Diversification (quadratic) on Firm Performance (winsorized ROA.) I find that Geographic Diversification (quadratic) has a significant effect on Firm Performance. However, when I add an interaction term for Crisis (i.e. Global Financial Crisis 2007-2009) to examine the impact pre-Crisis and post-Crisis, I find that Geographic Diversification (quadratic) NO LONGER has a significant impact.
Would it be appropriate for me to conclude that Geographic Diversification (quadratic) itself IS a significant predictor. However, Crisis (pre-post Crisis) makes no difference to its predictive power.
I am adding the results just for your reference. Thanks.
A. Impact of Geographic Diversification (Quadratic)
B. Impact of Geographic Diversification (Quadratic) + INTERACTION with CRISIS
I am running a panel data analysis to examine the effect of Geographic Diversification (quadratic) on Firm Performance (winsorized ROA.) I find that Geographic Diversification (quadratic) has a significant effect on Firm Performance. However, when I add an interaction term for Crisis (i.e. Global Financial Crisis 2007-2009) to examine the impact pre-Crisis and post-Crisis, I find that Geographic Diversification (quadratic) NO LONGER has a significant impact.
Would it be appropriate for me to conclude that Geographic Diversification (quadratic) itself IS a significant predictor. However, Crisis (pre-post Crisis) makes no difference to its predictive power.
I am adding the results just for your reference. Thanks.
A. Impact of Geographic Diversification (Quadratic)
Code:
. xtreg ROA_win05 Ln_Revenue Ln_LTDTA CoAge TPSD Ind_GSD wGDPpc wCPI wDCF wExpgr wGDPgr wC
> ons c.l1.GSD##c.l1.GSD if NATION=="UNITED STATES" & FOREIGNSALESTOTALSALES5>10 & Mfg_Rat
> io==100 &FOREIGNSALESTOTALSALES >10 & Year_ < YearInactive , fe cluster(n_CUSIP)
Fixed-effects (within) regression Number of obs = 789
Group variable: n_CUSIP Number of groups = 90
R-sq: Obs per group:
within = 0.0273 min = 1
between = 0.0034 avg = 8.8
overall = 0.0011 max = 18
F(11,89) = .
corr(u_i, Xb) = -0.5283 Prob > F = .
(Std. Err. adjusted for 90 clusters in n_CUSIP)
---------------------------------------------------------------------------------
| Robust
ROA_win05 | Coef. Std. Err. t P>|t| [95% Conf. Interval]
----------------+----------------------------------------------------------------
Ln_Revenue | 1.728391 1.265633 1.37 0.175 -.7863959 4.243178
Ln_LTDTA | -.7309066 .2667187 -2.74 0.007 -1.260871 -.2009423
CoAge | -.1666455 .1232228 -1.35 0.180 -.4114865 .0781955
TPSD | -.0494397 1.379651 -0.04 0.971 -2.790778 2.691898
Ind_GSD_by_Year | 1.182452 2.262421 0.52 0.603 -3.31293 5.677835
wGDPpc | .0000272 .0002483 0.11 0.913 -.000466 .0005205
wCPI | -.3168193 .2987043 -1.06 0.292 -.9103383 .2766997
wDCF | 8.66e-13 1.34e-12 0.65 0.519 -1.79e-12 3.52e-12
wExpgr | .0950372 .1363352 0.70 0.488 -.1758579 .3659323
wGDPgr | -.3723475 .3451565 -1.08 0.284 -1.058166 .3134712
wCons | -3.36e-13 4.77e-13 -0.70 0.483 -1.28e-12 6.12e-13
|
GSD |
L1. | 7.387182 3.322333 2.22 0.029 .7857782 13.98859
|
cL.GSD#cL.GSD | -5.720092 2.565952 -2.23 0.028 -10.81858 -.6216003
|
_cons | -20.93078 23.15702 -0.90 0.369 -66.94329 25.08173
----------------+----------------------------------------------------------------
sigma_u | 19.79479
sigma_e | 6.1509629
rho | .91194518 (fraction of variance due to u_i)
---------------------------------------------------------------------------------
Code:
. xtreg ROA_win05 Ln_Revenue Ln_LTDTA CoAge TPSD Ind_GSD wGDPpc wCPI wDCF wExpgr wGDPgr wC
> ons c.l1.GSD##c.l1.GSD##i.Crisis if NATION=="UNITED STATES" & FOREIGNSALESTOTALSALES5>10
> & Mfg_Ratio==100 &FOREIGNSALESTOTALSALES >10 & Year_ < YearInactive & Year_ !=2007 & Ye
> ar_ !=2008 & Year_ !=2009, fe cluster(n_CUSIP)
Fixed-effects (within) regression Number of obs = 635
Group variable: n_CUSIP Number of groups = 87
R-sq: Obs per group:
within = 0.0513 min = 1
between = 0.0053 avg = 7.3
overall = 0.0000 max = 15
F(14,86) = .
corr(u_i, Xb) = -0.5771 Prob > F = .
(Std. Err. adjusted for 87 clusters in n_CUSIP)
--------------------------------------------------------------------------------------
| Robust
ROA_win05 | Coef. Std. Err. t P>|t| [95% Conf. Interval]
---------------------+----------------------------------------------------------------
Ln_Revenue | 2.069123 1.408599 1.47 0.146 -.7310791 4.869325
Ln_LTDTA | -.5427035 .3154488 -1.72 0.089 -1.169795 .084388
CoAge | -.1962319 .17543 -1.12 0.266 -.5449752 .1525113
TPSD | -.1994187 1.279324 -0.16 0.876 -2.74263 2.343792
Ind_GSD_by_Year | 2.665089 2.389298 1.12 0.268 -2.084678 7.414857
wGDPpc | .0001957 .0002514 0.78 0.438 -.0003041 .0006956
wCPI | .5417431 .3146595 1.72 0.089 -.0837794 1.167266
wDCF | 1.36e-13 1.65e-12 0.08 0.934 -3.14e-12 3.41e-12
wExpgr | -.0629232 .1487029 -0.42 0.673 -.3585348 .2326883
wGDPgr | .1220212 .4301731 0.28 0.777 -.7331345 .977177
wCons | 7.66e-15 5.85e-13 0.01 0.990 -1.15e-12 1.17e-12
|
GSD |
L1. | 11.83602 6.352277 1.86 0.066 -.7918874 24.46393
|
cL.GSD#cL.GSD | -7.955007 5.480996 -1.45 0.150 -18.85087 2.940853
|
1.Crisis | 3.993319 2.642572 1.51 0.134 -1.259941 9.246578
|
Crisis#cL.GSD |
1 | -4.968958 8.793173 -0.57 0.573 -22.44921 12.51129
|
Crisis#cL.GSD#cL.GSD |
1 | 1.985325 7.40009 0.27 0.789 -12.72557 16.69622
|
_cons | -37.6528 27.47821 -1.37 0.174 -92.27768 16.97208
---------------------+----------------------------------------------------------------
sigma_u | 18.71923
sigma_e | 5.5148036
rho | .92013852 (fraction of variance due to u_i)
--------------------------------------------------------------------------------------
