I have a question about the fixed effects model.
I have 25 manufacturing sectors for a 12 year period (balanced panel data set) and I try to find out the effect of each sector's investment expenditure on the ratio of skilled/ unskilled workers for each sector, so my regression model is:
S/U= f(real investment expenditure) among other things. Because I'm interested in capturing the effect of investment on S/U for different sectors individually, I created dummy variables for each sector and interacted them with investment expenditures of each sector. When I run that regression with fixed effects, investment appears to be a significant factor for determining skill ratio only for 2 sectors. However, when I run the regression with fe, vce (robust), the relationship seems significant for almost all sectors.
I'm wondering how this is possible.