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       log:  d:\bill\fall2008\econ30331\cig_industry.log
  log type:  text
 opened on:  28 Sep 2008, 11:58:44

. 
. * open stata data file
. use cig_industry

. 
. * get description of data
. desc

Contains data from cig_industry.dta
  obs:            31                          
 vars:             4                          28 Sep 2008 11:53
 size:           682 (99.9% of memory free)
-------------------------------------------------------------------------------
              storage  display     value
variable name   type   format      label      variable label
-------------------------------------------------------------------------------
year            int    %8.0g                  
q               float  %9.0g                  output, billions of cigarettes
l               float  %9.0g                  thousands of workers
                                                (production+nonprod)
k               float  %9.0g                  capital assets index, 1987=100
-------------------------------------------------------------------------------
Sorted by:  

. 
. * generate logs of all variables
. 
. gen kl=ln(k)

. gen ll=ln(l)

. gen ql=ln(q)

. 
. * run unrestricted model
. reg ql ll kl

      Source |       SS       df       MS              Number of obs =      31
-------------+------------------------------           F(  2,    28) =   10.22
       Model |  .063440086     2  .031720043           Prob > F      =  0.0005
    Residual |   .08691176    28  .003103991           R-squared     =  0.4219
-------------+------------------------------           Adj R-squared =  0.3807
       Total |  .150351846    30  .005011728           Root MSE      =  .05571

------------------------------------------------------------------------------
          ql |      Coef.   Std. Err.      t    P>|t|     [95% Conf. Interval]
-------------+----------------------------------------------------------------
          ll |   .1009336   .0539433     1.87   0.072    -.0095644    .2114315
          kl |   .2581351   .0574695     4.49   0.000     .1404142     .375856
       _cons |   4.999207   .3941311    12.68   0.000     4.191866    5.806548
------------------------------------------------------------------------------

. 
. * test for constant returns to scale
. test kl+ll=1

 ( 1)  ll + kl = 1

       F(  1,    28) =   43.69
            Prob > F =    0.0000

. 
. * generate variables for brute force model
. gen ql_kl=ql-kl

. gen ll_kl=ll-kl

. 
. * run restricted model
. reg ql_kl ll_kl

      Source |       SS       df       MS              Number of obs =      31
-------------+------------------------------           F(  1,    29) =   89.60
       Model |  .687494683     1  .687494683           Prob > F      =  0.0000
    Residual |  .222525857    29  .007673305           R-squared     =  0.7555
-------------+------------------------------           Adj R-squared =  0.7470
       Total |   .91002054    30  .030334018           Root MSE      =   .0876

------------------------------------------------------------------------------
       ql_kl |      Coef.   Std. Err.      t    P>|t|     [95% Conf. Interval]
-------------+----------------------------------------------------------------
       ll_kl |   .4080094   .0431049     9.47   0.000     .3198499    .4961688
       _cons |   2.398959   .0380002    63.13   0.000      2.32124    2.476678
------------------------------------------------------------------------------

. 
. 
end of do-file

. log close
       log:  d:\bill\fall2008\econ30331\cig_industry.log
  log type:  text
 closed on:  28 Sep 2008, 12:03:22
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