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  • difference and differences (DID) model, dependent variable of three levels , impact assessment and panel data

    Dear All,
    I am analyzing the impact of adopting two technologies using panel data. My dependent variable is "ADOPTION," which is categorized into 0=non-adopters, 1=partial adopters, and 2=both technology adopters; Independent variables include respondents' demographic and socio-economic variables; the outcome variable is production cost. I am using six years of panel data (2016-2021).

    Usually when we estimate DID in Stata we follow the following formula,
    production cost Yit = a0+ a1Year+ a2Treatment+ a3Year*Treatment+ age+ edu +…..error

    But as I want to add the variable "ADOPTION," I struggle to figure out how?

    Can anyone Kindly advise how to incorporate the 'ADOPTION' variable?
    Thank you very much.

  • #2
    Please see the attached file for further understanding
    Attached Files

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