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Hi I'm currently writing my thesis and I need to estimate the following equation: DISXt⁄At-1 = β0 + β1 1/At-1 +β2St-1/At-1 + εt

Can someone help how I can run the regression with variables as fractions like this? I know that probably I need to create new variables for these fractions but I wonder if there any other way to deal with it?

Really appreciate any help!!

Gregor Thomas
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Loan Tran
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    You can use mathematical expressions in an R formula if you wrap them in `I()`, e.g., `lm(I(DISXt / At - 1) ~ I(1/At) + I(St - 1 / At - 1), data = your_data)`. That said, I would probably just create the new columns... it can make plotting your data and examining results easier if you have them on hand. – Gregor Thomas Jun 15 '21 at 13:12

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