/* Example for post-estimation tests within the context of a Hedonic Property Value Study */

#delimit;
set more off;
set logtype text;
set mem 100m;
set matsize 80;


log using c:\klaus\apec64\spring_07\stata\logs\hedonic_tests,replace;
use c:\klaus\apec64\spring_07\stata\data\hedonic_example_full;

/* Step 1: Run preferred model */
/*******************************/
regress lnadj tsqf bedrms bathrms age garage view firepl porch dist00 dist00sq sewer;

/* Step 2: Test for Heteroskedasticity */
/**************************************/

/* rvfplot */
rvfplot, yline(0);

/* Breusch-Pagan test */
estat hettest;
estat hettest distance;
estat hettest distance age;
estat hettest distance age garage;

/* IM test (~ White's test) */
estat imtest;

/* remedy for heteroskedastic variances: run model with robust standard errors */

regress lnadj tsqf bedrms bathrms age garage view firepl porch dist00 dist00sq sewer, robust;


/* Step 3: Test for Multicollinearity */
/**************************************/

/* Inspect correlation across explanatory variables */
corr tsqf bedrms bathrms age garage view firepl porch dist00 dist00sq sewer;

/* Variance Inflation Factors */
vif;

/* drop dist00sq from regression */
regress tsqf bedrms bathrms age garage view firepl porch dist00 sewer, robust;
vif;

/* Step 4: Test for Omitted Variables */
/* ********************************** */

/*re-run original model */
regress lnadj tsqf bedrms bathrms age garage view firepl porch dist00 dist00sq sewer, robust;

/* Ramsey test */
estat ovtest;

/* run model with dropped or added regressors and check if remaining coefficients change significantly */

regress lnadj tsqf bedrms bathrms age garage view firepl porch sewer, robust;


log close;