Logistic regression with dummy variables and regular variables


My logit regression for a sample of 182 has 4 significant explanatory variables. One of these variables is a dummy variable and the rest are regular ratio type data point variables.

Given this, how do I interpret my grand mean and intercept term? And how do I interpret the coefficient of the dummy variable? If I need to calculate my mean WTP, do I still use the formula:


where b0 is intercept term, b2 is the coefficient for the variable x2, x2bar is the sample mean of x2 and b1 is the coefficient of the bid value variable; without any caution against the fact that my regression includes a dummy regressor?

Thank you.
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Ambassador to the humans
It depends on how the model was parameterized. What software did you use? And you're referring to logistic regression right - your outcome was binary?
I used Stata. Yes, my outcome (i.e. actual values) would be binary. But the fitted values are arrived at with the help of the CDF, and are not binary.


Ambassador to the humans
I don't work with Stata so I don't know how it does its default parameterization - somebody else will have to help there..

But the fitted values are arrived at with the help of the CDF, and are not binary.
Of course - it wouldn't really be logistic regression otherwise. I was just asking because you said "logit regression" which could be a non-linear regression using the logistic function as the response and just wanted to make sure we were on the same page.


No cake for spunky
The intercept is defined as it always is. The change in Y when all levels of X are zero (for the slope). In SAS at least there are two types of coding for dummy variables. In one case, reference I think, the level of the dummy is being compared to the level of the categorical variable you did not create a dummy for. The slope then is the mean difference between these levels. In effect coding, which is rarely used I suspect, the slope of the dummy is being compared to the mean of the means of the other levels (not the grand mean).

I would guess Strata does it the same way, you need to look at the documentation.