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I am running a regression on real GDP growth as the dependent variable. I am trying to include an initial year for GDP as an independent variable to control for the initial state of development in a time series regression focusing on one country.

How should I implement in this in STATA? i.e. What should the new Initial GDP variable look like

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If I understand your question you can estimate it as Delta GDP_t = Alpha + Beta GDP_0 where 0 is the initial year GDP in your single country. You first need to create a variable that takes the value of t=0 GDP for that country for all years. The beta coefficient will give your estimated effect of initial GDP on subsequent GDP growth rates.

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  • $\begingroup$ Does this explain what the initial GDP looks like. I sympathize with you because the question is not very clear. $\endgroup$
    – Michael R. Chernick
    Commented Apr 10, 2017 at 18:55

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