How to winsorize with specific conditions?

[Saleh sharmah]

Hi members

I am just wondering how to code the following in stata :how to winsorize total asset at the $4.5 billion, and firm age at 37 years?

thank you .

[Nick Cox]

gen totalasset2 = min(4.5e9, totalasset) if totalasset < .

may be suggestive. (This isn't Winsorizing!)

[Saleh sharmah]

Dear Nick
Thanks for your kind help. I am following a paper and here is the context of it as it may give a clear picture of what I need:

"Financial constraints index proposed by Hadlock and Pierce [2010]. It is calculated as (−0.737 × Size) + (0.043 × Size2) − (0.040 × Age). Size is the natural logarithm of inflation-adjusted book assets. Age is the number of years a firm is listed with a non-missing stock price on Compustat. Following Hadlock and Pierce [2010], book asset is winsorized at the $4.5 billion, and age is winsorized at 37 years. Higher values of all three indices indicate more financial constrained".

Thanks in advance for your kind support.

[Nick Cox]

It is not Winsorizing as I understand it to be usually defined, which is pulling in to a fraction or count of values
in one or both tails. I would call it topcoding.

But other people use the language too.

I don’t know what to make of a quotation without a reference.

More important, I gave you code already, and the principle for the second variable is the same as for the first.

[Saleh sharmah]

Thanks, Nick. the code worked well as wanted so thank you again.