I am doing an analysis about the export diversification effect during the financial crisis.

I have my dependent variable as log (GDP per capita) and some independent variables.

To measure diversification I calculated an Index which is called HI, this Index takes values from 0 to 1. There are three different ways to measure diversification and therefore three different HI's (HI1, HI2, HI3). I also created a dummy variable for the time periode before the financial crisis and afterwards (years 2004,2005,2006 --> crisis_dummy=0, years 2007,2008,2009 --> crisis_dummy=1).

To find out whether or not the export diversification has an influence on log (GDP per capita) during/before the crisis I want to estimate the following estimation equation:

log(GDPpc)= a*crisis_dummy+b1*HI1+b2*HI2+b3*HI3+d1*crisis_dummy*HI1+d2*crisis_dummy*HI2+d3*crisis_dummy*HI3+(2 more independent variables as control variables).

My questions are:

1. Is this a proper estimation equation to figure out my research question (does a lower HI help to increase/not decrease log (GDP per capita) during the financial crisis)?

2. Is the application of the dummyvariables correct?

3. Besides the problem of multicollinearity do you see others potential problems?

I hope I explained my question in a propper way and I hope somebody can help me with my problem.

Thank you