Hey members, a newbie to SPSS here and need help. Any help is extremely appreciated.
My question revolves around dummy variables, how to physically implement them correctly on SPSS? I have only seen simple examples (gender, male female etc) but cannot grasp the concept when working with percentage points datasets.
I am working on a thesis where I examine the negative interest rates impact on banks' profits.
I examine two countries banking sectors, Germany and the UK. I examine the years between 2012-2016.
The programme of negative interest rates started in 2014.
I'm working with Differrence-In-Difference method. The Control group is the UK and the Treatment group is Germany.
My equation is this:
𝑦 = 𝛽 + 𝛽1𝑇𝑟𝑒𝑎𝑡 + 𝛽2𝑃𝑜𝑠𝑡 + 𝛽3𝑇𝑟𝑒𝑎𝑡𝑃𝑜𝑠𝑡 + 𝛽4 𝑅𝑎𝑡𝑒𝑠 + 𝛽5𝑆𝑝𝑟𝑒𝑎𝑑 + 𝛽6𝐺𝐷𝑃 + 𝜀
y= Return on Assets (Profits)
The 𝛽1𝑇𝑟𝑒𝑎𝑡 variable is a dummy (=1 If the country implemented the programme)
𝛽2𝑃𝑜𝑠𝑡 is also a dummy variable (=1 After the implementation of the programme)
𝛽4 𝑅𝑎𝑡𝑒𝑠 is 3-month government bond
𝛽5𝑆𝑝𝑟𝑒𝑎𝑑 is the spread between 10-year and three-month bond.
𝛽6𝐺𝐷𝑃 is GDP growth rate.
So now you guys hopefully got a better picture of what I am dealing with, how do I create a dummy variable with this kind of dataset in mind?