Industry Dummy Variable

[rob86]

Hi Guy

Does anyone know how I would enter 2 dummy variables? I want to use a dummy for a companys industry and one for it level of multinationality.

Im able to use the @expand function for one ok and and can do both at the same time e.g @expand(ind,class) but I cant do to seperate @expand with out getting near singular matrix, I understand this may be the dummy variable trap from reading the forum but still dont know what to do.

If you have 2 dummys can you use the @expand function or is there a different way to do it?

The regression im trying to run is: ey lta beta @expand(ind) @expand(class). I have attached the eviews file.

Thanks for your help.

Rob

[EViews Gareth]

Use the @drop part of @expand to drop one or more of the dummy types to avoid the dummy variable trap. See the documentation on @expand for further details.

[rob86]

ok great, thanks for your help