I am running binary multilevel models on whether or not households have bank accounts. Apart from relevant economic, social and demographical household level variables I also include two contextual variables for the primary sampling units (PSU), which are either villages or urban neighborhoods. These two measure the wealth level (assets) and the educational level of the PSU’s. Because a relevant explanatory variable is whether a bank branch is within the vicinity of the household and because households in urban areas should be expected to be closer to the nearest bank branch I expect the dummy variable for URBAN to be positively associated with having a bank account. The proportion of households with bank accounts are higher in urban (53.1) than in rural (30.9) PSU’s and average wealth and educational levels are higher in urban than in rural PSU’s.

However, the dummy for URBAN has a positive sign when the two contextual variables for PSU wealth and education are not included and a negative sign when they are included. How should I interpret this?

KML