- 3

- 0

logY = a + (beta)logX + e

Ok, my regression is more than that, but I need only a simple version.

logY = log of gdp per capita

logX = log of 'quality of governance', where X is [0,1]

beta = 2.6, when the regression is run

So, I have two countries that I would like to compare, Senegal and Hungary, as they occupy opposite ends of the interquartile range. The basic idea is to show what happens when you increase Senegal's institutions to the level of Hungary's. I am working off the assumption that the log-log form gives me a "one percent increase in X leads to a beta percent increase in Y".

So, do I work out the percentage increase from Senegal's unlogged institutions (0.39) vs Hungary's unlogged institutions (0.72), or the percentage increase between the logged versions?

Let me know if that isn't clear.