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  • Regressions with interaction terms and interacted fixed effects

    Hi, i've got some questions about how to run a regression with interactions especially how to deal with interacted FE.
    My first question is if it is necessary to include interacted FE in my regression. Without the interaction term I estimated the following linear regression : regress cutting_ precip_ i.grid_cell_ i.year_of_circ i.v010
    [pweight = wgt], vce(cluster grid_cell)
    where I included grid cell FE, age of cutting FE and year of birth FE. Now I want to see if a law changed my coefficients. I used: regress cutting_ precip_ precip_post_law i.v010_post_law i.grid_cell_post_law i.year_of_circ_post_law[pweight = wgt], vce(cluster grid_cell) where post_law is the dummy indicating observations for precipitation post law. I thought About including interacted FE by interacting each FE with the dummy variable. I constructed the interacted FE's: gen
    v010_post_law= v010*post_law. Is this correct or is it sufficient to just include i.grid_cell_ i.year_of_circ i.v010?
    My second question deals with estimating heterogenous effects by age. I want to estimate: regress cutting_ precip_age0 precip_age1 precip_age2 precip_age3 precip_age4 and want to see if the effect varies by age. I'm not sure about the inclusion of interacted fixed effects. Do I have to include i.grid_cell_age1 i.grid_cell_age2... for each age or is it sufficient to just include i.grid_cell i.v010? I hope my questions are comprehensible and
    someone could help my with my problem. It would be really nice if someone could help me. Thanks in advance.

  • #2
    Lea:
    unfortunately, your questions are difficult to reply, as you did not post what you typed and what Stata gave you back via CODE delimiters (please see the FAQ on this and other posting-related topics. Thanks).
    Kind regards,
    Carlo
    (StataNow 18.5)

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