CODEWITHSUNDEEP
statainteraction
Olive
Olive

Reputation: 644

Creating interaction terms with continuous variables in stata

I have "trading" as a variable. I want to see how trading by the rich and the poor affect their total asset returns by interacting this continuous variable "trading" with a dummy rich, poor and compare the effect vis a vis the middle. I am using stata.

Is it correct to specify?

reg returns c.trading##top c.trading##bottom .. and some other variables

Upvotes: 0

Views: 607

Answers (1)

Bicep
Bicep

Reputation: 1103

You can specify an interaction between a continuous variable and a categorical variable as such:

sysuse auto
reg price c.weight#i.rep78

I'd recommend using factor-notation (i.) to make it explicit that the categorical variable is a categorical variable.

Upvotes: 2

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