I am doing an OLS regression with interaction effects and dummy variables, where the interaction effect is given by the dummy variables. Remaining variables are continuous. I am quite new to statistics so i would need some help for interpreting results. I have the following simplified model:
return = 0.44 + 0.5size + 0.3cost + 1.2D1 + 1.3D2 + 0.4D1*size -0.55D2*size + 0.32D1*cost - 0.8D2*cost
The model includes three dummy variable that are defined as employed (D1), self-employed (D2) and unemployed (base condition).
Am i correct in interpreting results in the following way: - First beta coefficient (0.5size) indicates the effect of size on return when a person is unemployed - 0.4D1*Size indicates the additional effect of size compared to the base condition (unemployed) when the person is employed -> the total effect is 0.5+0.4 - (-0.55D2*size) indicates the additional effect of size compared to the base condition when the person is self-employed -> the total effect is (0.5 -0.55) for self-employed individuals
Also: say instead of size i have a male/female dummy variable with male =0. Simplified model: return = a +0.3Dmale +0.4D1 + 0.5D2 +0.6Dfemale+ 1.8Dmale*D1 +0.8D2*Dmale +... 0.3 is the effect that being male and unemployed has on returns, 0.4 the effect of being employed, 0.5 of being self-employed. 1.8 is the effect that being male and employed has on returns compared to being male and unemployed (so total effect 0.3+1.8), same for 0.8 only with different dummy definition.
Am i correct? Thank you!!