Could you explain in simple language, how adjusting works for categorical variables in regression? Googled without any success.
Let's take a model:
income ~ country + city + money_spent_on_education
Handling of continuous variables:
money_spent_on_education - sets this to mean value while assessing the effects of other predictors
Handling of categorical variables:
county - does regression just equalises the county levels in analysis (e.g. Germany and USA have both same weight on b coefficients)?
city - does regression just equalises the city levels in analysis (e.g. Berlin and New York have both same weight on b coefficients)?