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  • interpreting effect types

    Hello, I have the following model:
    Code:
    reg demscore gdp colony
    where colony is a binary 0/1.

    I want to understand the difference between marginal and average marginal effects. I understand the marginal effect of gdp on demscore to be the partial derivative of y wrt gdp, such that a 1unit increase in gdp is associated with an increase in demscore by the value of the coefficient of gdp. I also understand that the average marginal effect is the partial effect of gdp on demscore for the covariates. When the model is linear such as this one, is the marginal effect and the average marginal effect the same since the value of gdp does not depend on colony?


  • #2
    A follow up question relates to the difference between AME and conditional effects. If my model were instead:

    Code:
    reg demoscore gdp##i.colony
    and both variables were centered at their mean, would the average marginal effect of gdp still just be the coefficient on gdp? how do I interpret the conditional effect of gdp on colony?

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