comparing means

[michield]

Hello,

I'm investigating the influence of investment on the ownershipstructure of public companies. Now I would like to compare the means of investment and ownership concentration. It's a time series from 2006 to 2012. I would like to know if there is a difference between the means of investment between the companies that have a ownership concentration lower than 50% and higher than 50%. So how do I make this split in ownership concentration and how do I compare those means?

thanks in advance!

[EViews Glenn]

Suppose the series for investment is INVEST and the concentration series is CONCENT (which has the percentage concentration).

Open the INVEST series.

Click on View/Descriptive Statistics & Tests/Equality Tests By Classification...

Enter the expression:

CONCENT>50

in the Series/Group for classify edit field. You should be able to leave everything else as is since you only have two categories. Click on OK.

[michield]

But how do I interpreted this? CONCENT 0 has a mean of 0.51 and concent1 has a mean of 0.54. Does the zero stands for <50% en the one for >50%?

thanks

[trubador]

Code: Select all

equation eq.ls invest c (concent>0.5)

Constant term (c) represents the cases of (concent<0.5) and therefore will be equal to 0.51. Coefficient of (concent>0.5), however, will give you the difference (i.e. 0.54-0.51=0.03). If the impact of owner concentration on investment differs between <50% and >50%, then you expect this coefficient to be statistically significant (e.g. p-value < 0.05).