Economic

Assume you want to model health outcomes as a function of two conditions; asthma, and pulmonary disease. Your independent variable is a health outcome of interest, and your identification strategy includes a demographics vector (with age, gender, and race), and you have dummy variables for asthma and pulmonary disease (=1 if condition is present. 0 otherwise). You end up with this model Health Outcome = By + Brage + Brace + Bagender + Biasthma + B. PulmonaryDisease + c To capture the effect on health of having both conditions at the same time, you; O Add an interaction term between asthma and pulmonary disease O Remove the parameter estimates for asthma and pulmonary disease, and replace them with an interaction term Use the intercept term with a dummy variable that takes the value 1 if the observation is in the control group O just add up the parameter estimates for asthma and pulmonary disease