Interactions in Fixed Effects Regression Models

Autor/inn/en	Giesselmann, Marco; Schmidt-Catran, Alexander W.
Titel	Interactions in Fixed Effects Regression Models
Quelle	In: Sociological Methods & Research, 51 (2022) 3, S.1100-1127 (28 Seiten) PDF als Volltext Verfügbarkeit
Zusatzinformation	ORCID (Giesselmann, Marco)
Sprache	englisch
Dokumenttyp	gedruckt; online; Zeitschriftenaufsatz
ISSN	0049-1241
DOI	10.1177/0049124120914934
Schlagwörter	Regression (Statistics); Monte Carlo Methods; Correlation; Evaluation Methods; Algebra + Suchen Sie Ihr Suchwort? Regression; Regressionsanalyse; Monte-Carlo-Methode; Korrelation
Abstract	An interaction in a fixed effects (FE) regression is usually specified by demeaning the product term. However, algebraic transformations reveal that this strategy does not yield a within-unit estimator. Instead, the standard FE interaction estimator reflects unit-level differences of the interacted variables. This property allows interactions of a time-constant variable and a time-varying variable in FE to be estimated but may yield unwanted results if both variables vary within units. In such cases, Monte Carlo experiments confirm that the standard FE estimator of x · z is biased if x is correlated with an unobserved unit-specific moderator of z (or vice versa). A within estimator of an interaction can be obtained by first demeaning each variable and then demeaning their product. This "double-demeaned" estimator is not subject to bias caused by unobserved effect heterogeneity. It is, however, less efficient than standard FE and only works with T > 2. (As Provided).
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Erfasst von	ERIC (Education Resources Information Center), Washington, DC
Update	2024/1/01