Empirical Economics

, Volume 45, Issue 1, pp 583–603

Interaction effects in econometrics

Article

DOI: 10.1007/s00181-012-0604-2

Cite this article as:
Balli, H.O. & Sørensen, B.E. Empir Econ (2013) 45: 583. doi:10.1007/s00181-012-0604-2

Abstract

We provide practical advice for applied economists regarding robust specification and interpretation of linear regression models with interaction terms. We replicate a number of prominently published results using interaction effects and examine if they are robust to reasonable specification permutations.

Keywords

Non-linear regressionInteraction terms

JEL Classification

C12C13

Copyright information

© Springer-Verlag 2012

Authors and Affiliations

  1. 1.School of Economics and FinanceMassey UniversityPalmerston NorthNew Zealand
  2. 2.Suleyman Sah UniversityIstanbulTurkey
  3. 3.Department of EconomicsUniversity of HoustonHoustonUSA
  4. 4.CEPRLondonUK