I'm having problem to understand how my dataset should be organized. I have unbalanced panel data with observations of products' prices as independent variable. Data is from a 3-year period.
Now, I want to include annual GDP per capita, population, income per capita as instrumental variables.
Where should I put it - to the columns to the right for overy observation? Should I choose the value from the same year in which the product was observed or year before?
Can someone please provide an example. Any guidance will be appreciated.