*
* Example 7.8 from page 231
*
open data lawsch85.raw
data(format=free,org=columns) 1 156 rank salary cost lsat gpa libvol faculty age clsize north south east west lsalary studfac top10 r11_25 r26_40 r41_60 llibvol lcost
*
* This shows how to create the rank dummies
*
set top10   = rank<=10
set r11_25  = rank>=11.and.rank<=25
set r26_40  = rank>=26.and.rank<=40
set r41_60  = rank>=41.and.rank<=60
set r61_100 = rank>=61.and.rank<=100
*
linreg lsalary
# constant top10 r11_25 r26_40 r41_60 r61_100 lsat gpa llibvol lcost
*
* Calculate and display the percentage differences
*
disp "Exact Percentage Advantages Over Schools Rank>100"
disp "Top 10" 100*(exp(%beta(2))-1)
disp "11-25 " 100*(exp(%beta(3))-1)
disp "26-40 " 100*(exp(%beta(4))-1)
disp "41-60 " 100*(exp(%beta(5))-1)
disp "61-100" 100*(exp(%beta(6))-1)
*
* Joint test of variables other than the rank dummies
*
exclude
# lsat gpa llibvol lcost
*
* Regression with rank alone rather than the categories
*
linreg lsalary
# constant rank lsat gpa llibvol lcost
exclude
# lsat gpa llibvol lcost