time as an independent variable

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jasil
Posts: 9
Joined: Fri Jun 04, 2010 3:58 pm

time as an independent variable

Postby jasil » Fri Jun 25, 2010 8:36 am

hi everyone.
I'm running a regression where I'm told to include TIME as an independent variable. So my question is: should I state the values of this variable as 1,2,... ? and if this is correct this variable wouldnt be stationary so, would I have to look at the first difference?
maybe E views have some resources to create this kind of varaibles, I would really appreciate some suggestions.
thanks a lot.

startz
Non-normality and collinearity are NOT problems!
Posts: 3797
Joined: Wed Sep 17, 2008 2:25 pm

Re: time as an independent variable

Postby startz » Fri Jun 25, 2010 10:01 am

It's generally fine to include a time trend.

Take a look at the EViews function @trend for creating one.

jasil
Posts: 9
Joined: Fri Jun 04, 2010 3:58 pm

Re: time as an independent variable

Postby jasil » Mon Jun 28, 2010 8:40 am

thanks a lot startz


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