Hi all,
I performed a difference-in-difference study in Stata and I am struggling with the interpretation.
I hope you can help me
I entered the something as the following formula, explaining the leverage ratios of firms over the time period 2004-2010.
Post is a dummy for time after 2007.
Connected is a dummy for being poltically connected.
The coefficient of the interaction term is negative.
Does this mean that connected firms have LOWER leverage ratios in the years following 2007 relative to non-connected firms
OR
that connected firms have DECREASING leverage ratios in the years following 2007 relative to non-connected firms.
I really hope you can help me, internet confuses me a lot with multiple explanations...
Thank you!
I performed a difference-in-difference study in Stata and I am struggling with the interpretation.
I hope you can help me
I entered the something as the following formula, explaining the leverage ratios of firms over the time period 2004-2010.
Post is a dummy for time after 2007.
Connected is a dummy for being poltically connected.
Code:
xtreg leverageratio post##connected independentvariables, re(cluster id)
Does this mean that connected firms have LOWER leverage ratios in the years following 2007 relative to non-connected firms
OR
that connected firms have DECREASING leverage ratios in the years following 2007 relative to non-connected firms.
I really hope you can help me, internet confuses me a lot with multiple explanations...
Thank you!
