Factor Variables and Interactions (Regression)

Using the maize only version of eth_allrounds_final.dta with per hectare inputs:

1. Run a regression of yield_kg on fert and labor, adding regional fixed effects with i.admin_1. Which region is the omitted reference category?
2. Run a regression with an interaction between fertilizer (c.fert) and irrigation (i.irr). What is the coefficient on the interaction term? What does the interaction coefficient mean?
3. Fit a quadratic in fertilizer. What does the sign of the squared term tell you about diminishing returns?

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