* Reference: Chapters 9 and 13 of * Jeffrey M. Wooldridge, Introductory Econometrics: A Modern Approach, * South-Western College Publishing, 2000. SAMPLE 1 46 READ (CRIME2.shd) pop crimes unem officers pcinc west nrtheast south & year area d87a popden crmrte offarea lawexpc polpc lpop & loffic lpcinc llawexpc lpopden lcrimes larea lcrmrte & clcrimes clpop clcrmrte lpolpc clpolpc cllawexp cunem & clpopden lcrmrt_1 ccrmrte & pop87 crimes87 unem87 office87 pcinc87 west87 nrthea87 south87 & year87 area87 d87b popden87 crmrte87 offare87 lawexp87 polpc87 * Data validation check IF (year.ne.82) STOP IF (year87.ne.87) STOP SET MISSVALU=-999 SET SKIPMISS SET NOWARNMISS * Example 9.4 * Log transformations GENR lcrte87=LOG(crmrte87) GENR llexp87=LOG(lawexp87) GENR lcrte82=LOG(crmrte) * Table 9.3, p. 290. OLS lcrte87 unem87 llexp87 OLS lcrte87 unem87 llexp87 lcrte82 TEST lcrte82=1 * Section 13.3 * Equation at bottom of p. 419. OLS crmrte87 unem87 * Pooled OLS - Stack the data MATRIX crmrte2=(crmrte'|crmrte87')' MATRIX d87=(d87a'|d87b')' MATRIX unem2=(unem'|unem87')' * Equation (13.16), p. 421 SAMPLE 1 92 OLS crmrte2 d87 unem2 SAMPLE 1 46 * Difference across the two years GENR crmrteD=crmrte87-crmrte GENR unemD=unem87-unem * Obtain the first-differenced estimator - Equation (13.18), p. 422. OLS crmrteD unemD STOP