Control variables in interactive models /
deHaan, Ed
Control variables in interactive models / Ed deHaan, James Moon, Jonathan Shipman, Quinn Swanquist, and Robert Whited - Vol 8 (2) pages 77-86 : illustrations ; 28 cm
ABSTRACT:
Accounting studies often examine whether the relation between X and Y varies with a moderating variable, M, by including an interactive term, X x M, in a regression. We provide plain-English guidance on why, how, and when to use control variables, Z, in interaction tests. A simulation and simple descriptions demonstrate how interacted controls affect coefficient estimates and interpretations. In particular, we demonstrate how controlling for Z without an accompanying interaction of X x Z and/or M x Z generally does not eliminate the confounding effect of Zon X x M. We conclude with guidance for future research.
accounting research
interactions
control variables
Control variables in interactive models / Ed deHaan, James Moon, Jonathan Shipman, Quinn Swanquist, and Robert Whited - Vol 8 (2) pages 77-86 : illustrations ; 28 cm
ABSTRACT:
Accounting studies often examine whether the relation between X and Y varies with a moderating variable, M, by including an interactive term, X x M, in a regression. We provide plain-English guidance on why, how, and when to use control variables, Z, in interaction tests. A simulation and simple descriptions demonstrate how interacted controls affect coefficient estimates and interpretations. In particular, we demonstrate how controlling for Z without an accompanying interaction of X x Z and/or M x Z generally does not eliminate the confounding effect of Zon X x M. We conclude with guidance for future research.
accounting research
interactions
control variables