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The Stata Journal
Volume 18 Number 1: pp. 159-173

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Fitting and interpreting correlated random-coefficient models using Stata

Oscar Barriga Cabanillas
University of California
Davis, CA
Jeffrey D. Michler
University of Saskatchewan
Saskatoon, Canada
Aleksandr Michuda
University of California
Davis, CA
Emilia Tjernström
University of Wisconsin
Madison, WI
Abstract.  In this article, we introduce the community-contributed command randcoef, which fits the correlated random-effects and correlated random-coefficient models discussed in Suri (2011, Econometrica 79: 159–209). While this approach has been around for a decade, its use has been limited by the computationally intensive nature of the estimation procedure that relies on the optimal minimum distance estimator. randcoef can accommodate up to five rounds of panel data and offers several options, including alternative weight matrices for estimation and inclusion of additional endogenous regressors. We also present postestimation analysis using sample data to facilitate understanding and interpretation of results.

View all articles by these authors: Oscar Barriga Cabanillas, Jeffrey D. Michler, Aleksandr Michuda, Emilia Tjernström

View all articles with these keywords: randcoef, correlated random effects, correlated random coefficients, technology adoption, heterogeneity

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