Questions tagged [fixed-effects-model]

In biostatistics, fixed-effects may mean population-average effects. In econometrics, fixed-effects may represent the observed quantities in terms of explanatory variables that are treated as if the quantities were non-random.

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Caveats regarding the choice of the elementary panel model

Lets compare three panel most basic models: pooled, random effects, fixed effects. I observe common belief, that the fixed effect model estimation is "less biased", than in the other models. ...
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Fixed-effects Poisson estimator using quasi-maximum likelihood

I am trying to run a fixed-effects Poisson Quasi Maximum Likelihood estimator on 3-dimensional(year, country, industry) Panel data. The dependent variable is the number of patents(non-negative and non-...
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fixed effects models

Take the case of panel data with a time dimension in years and a cross-sectional dimension in plants (production units of firms). Each firm has many plants. I understand I cannot include plant fixed ...
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Fixed effect OLS with normalized coefficients in R

I want to estimate the following fixed effects regression: $$ Y_i = \gamma_{m}+ \lambda_b + \delta_{gb}D_{igb}+\varepsilon_i, $$ where $\gamma_m$ is municipality fixed effect, $\lambda_b$ is birth ...
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What exactly is controled for in a model with country, industry, and year fixed effects?

I don't have much experience with panel data so I apologize in advance if this sounds ridiculous. I am currently writing a thesis investigating the impact of political risk on managerial risk-taking. ...
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77 views

How to Remove Fixed Effects to Reduce Heterogeneity?

When discussing GMM estimation, Toni Whited and Luke Taylor suggest to reduce heterogeneity by ''eliminating fixed effects,'' see here on Taylor's slides (slide 36): My question: I'm not quite sure ...
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Panel regression with moving averages

Suppose I have a panel fixed effects regression of the form $$ Y_{it} = + \beta X_{it} + \alpha_i + \alpha_t + u_{it} $$ where Y is the outcome, X is a set of controls, ai and at constants for each ...
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Two-way fixed effects and collinearity

I am modeling the relationship of an independent variable $(x_t/z_i),$ where $t$ indexes time and $i$ individual with an outcome $y_{it}$. The log transformation of $(x_t/z_i)$ is prohibitively ...
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How can I generate longitudinal data with correlated individual effects and serially correlated error term in R/Rstudio?

I would like to generate longitudinal data with correlated individual fixed effects (correlation with the explanatory variable) and serially correlated error term in R/Rstudio. The data generating ...
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non linear model with fixed effect and instrumental variables

I encountered a project which has binary outcomes and repeated observations of the same individual, but the panel is short (T is small), so it seems that the only ...
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Time effects with dummy variable - regression

I am doing a multiple regression analysis and I wanted to inspect the time effect by using factor(Year) in R. However, I got the following summary results: Do you ...
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What is the difference between conditional and unconditional fixed effects?

What is the difference between unconditional and conditional (fixed effects negative binomial) regression models? A similar question was asked for quantile regression here: What is the difference ...
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Repeated Measures analysis of variance

I am new user of R software. I have 2 types of experiments. I want to analyze data from 10 jujube varieties and harvested fruits at 4 maturity stages. The effect of varieties is fixed while that of ...
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Pooled cross-sectional data or Fixed Effects?

Note: Apologies in advance for mistakes in terminology and understanding of the methods, I am a novice at this. I would like to compare the mental health of different groups of immigrants (by region-...
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Fixed effects and seasonality

I am looking at historical hourly electricity demand data over multiple years and trying to regress it with hourly temperature data to understand the true relationship. I am curious if the hour of the ...
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Using random effects for a between-subjects variable to assess variability in a mixed model

I want to use a mixed model to test random effects for between subject factors. Similar questions have been covered before, with answers that it can be done using lme4. (See here and here for some ...
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What is the mathematical model formula to a gam model fit using two fixed effects and interactions?

I am fitting a qGAM model via the qgam package in R; modelling the median of my response Y along covariates. It is of the form: ...
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Theoretical explanation of using time-fixed effects

I am currently sitting on an understanding issue. I did some regressions (pooled OLS) on my panel data and hold for time fixed effects. However, I am confused about the interpretation of the time ...
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Random effect accounting for main effect?

Situation: I'm analyzing results from an experiment with a hierarchical structure. There are two groups A and B, multiple subjects within each group, and multiple measurements within each subject. ...
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Regression model for a 2x3 mixed design with repeated measures?

Edited: I have a mixed (2x3) design setup where the between-subjects factor is "gender"(2 levels) and the within-subjects factor is "group"(3 levels). The main IV of interest is ...
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Do unbalanced observations contribute to identification in fixed effects models?

I am quite confused on how to interpret my regression results. I want to estimate the effect of tariff changes $\tau_{st}$ in sector $s$, period $t$ on firm $i$ employment. I have two time periods (4 ...
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Treat year as a fixed effect, random effect, or covariate?

I have a dataset of fish species from different sites within a harbour collected over 17 years. The dataset consists of 1,042 sampling transects collected at 6 specific locations where fish were ...
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1answer
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Difference-in-difference and panel data models

I understand that according to the observations you have (two independent cross-sections in two or more time periods or the same individuals observed in two different periods), then difference-in-...
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Normalization changes the effect of a variable in fixed effect logit

I have constructed a conditional/fixed effect logit model. My data consists of 6k+ groups in which I get two different coefficients for the same variable if I divide that variable to the the size of ...
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plm function in R: Order of input for index changes results when model = within?

I am only slightly familiar with the plm() function in R, and I get this odd phenomenon. When my input is this: ...
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How to choose the within factor in Fixed effect model

I am doing a fixed effect model to research on support’s effect on reducing number of injured employees. I have a dataset on company level from 2012-2020: year average age total salary total number ...
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Panel Data: (non-)Hierarchical prior modelling is equivalent to (fixed) random effects frequentist model

In Koop's Bayesian Econometrics, the author states that in a panel data model, where the slope is constant, but the intercept is allowed to change with the individuals being studied, if we impose: ...
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What variables to include in fixed effect model (Panel data)

I am doing a fixed effect model to research on support’s effect on reducing number of injured employees. I have a dataset on company level from 2012-2020: year average age total salary total number ...
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Should a Hausman test be used to decide between fixed vs. random effects?

I was taught that a Hausman test should be used in multilevel modeling in order to check whether random effects can be used. However, I have now stumbled over several sources stating that the Hausman ...
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Nested fixed effects in the lme4 package

I have browsed the internet for an answer to my question but have failed in my attempts. My experimental design includes nested fixed effects and I do not know how to specify this in my model in the ...
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2answers
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Which coefficients to include in out-of-sample prediction?

I am estimating a logistic regression on a subset of my data and predicting the outcome for the whole sample. In the regression only some data are statistically significant at the chosen level. ...
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Why we cannot control for states in a panel data?

I am examining one country over a period of 10 years. I am interested to see whether GDP growth (variable: gdp_growth) had a heterogeneous effect on wages across ...
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OLS Regression > Reverse Causation

I am interested to examine the effect on consumption on marijuana with the implementation of tax. I will be examining it on 51 states in US including DC, over 6 years. The other controlled variables ...
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Fixed effects vs the dummy variables themselves: structural vs practical equation

I have a question about if there is a substantive difference between a fixed effect and the way we estimate them (e.g., dummy variables). Are the estimated dummy variables the fixed effect, or do they ...
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When can HAC standard errors be appiled

In my one-way and two-way fixed effects models, I detected autocorrelation and heteroscedasticity. Therefore, I want to use HAC standard errors to correct my standard errors. Are there some ...
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How do I construct a consistent DiD estimator for this specification?

I have the following specification and I am attempting to re-write this in a DiD form which I can then go on to find $\hat{\beta}_{did}$ using OLS. $n$ observations $t \in\{1,2\}$ time periods $x_{it}/...
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What does this mean on a stargazer table

I am getting the following reported on my stargazer table after running a regression using felm: ...
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Unit root testing and cointegration when using first differences

I am working with a panel dataset with N=100 (countries) and T=20 (years) and tested for unit root and found that my data is non-stationary. I therefore conducted the unit root test for first ...
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How to calculate the fitted values of out-of-sample predictions from conditional fixed-effects Poisson model?

I am trying to calculate fitted values from xtpoisson fixed effects on out-of-sample data. I know how to calculate fitted values for in-sample predictions (using ...
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Advantage of within transformation over pooled OLS with dummies?

First, apply the within transformation (fixed effects transformation) on a panel data set. Then, apply pooled OLS with dummies for each cross-sectional unit on the same panel data set. When you ...
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Coefficient omitted due to time fixed effect and multi-collinearity

I am working on a research paper (my first one) where I am dealing with company level unbalanced panel data. There are broadly two types of control variables in the study - a) firm level control ...
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1answer
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Fixed effect model with time interactions

This seems like a somewhat basic question, but I'm struggling to figure this out and am hoping somebody can help: I'm fitting a model with panel data and person-level fixed effects with the goal of ...
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123 views

How to choose between pooled ols and fixed/random effect

I have unbalanced panel dataset, large N and relatively small T (about 15 timesteps). I know that the ols completely disregards the panel structure of the data. I was wondering if there is a test that ...
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Interpreting Pooled OLS and FE different results

I know there are many similar questions like this one, which I have consulted (e.g Panel Data: Pooled OLS vs. RE vs. FE Effects ; Pooled OLS vs RE and FE ; Difference between OLS and FE) . Yet I haven'...
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1answer
124 views

Identifying assumptions of Difference-in-Difference versus Fixed Effects models

I am reading the seventh edition of Introductory Econometrics: A Modern Approach by Jeffrey Wooldridge and I am a bit confused on the different identifying assumptions for difference-in-difference ...
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How to estimate this effect?

I have data with columns like this: [individual, song, is_after_drinking (IAD), enjoyment] I have observations on an indivudal J rating a song K (n=800 ...
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Lagged variable and Random/Fixed effect

I am running a regression on unbalanced panel dataset where I lagged by a timestep some of the explanatory variables. I also included an interaction effect between a lagged variable and a non lagged ...
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Is it possible to have a fixed effects model with Year, Region and Industry?

I'm trying to model the effects of Covid in different industries throughout different US states, and I was wondering if it is possible to use a fixed-effects model using region, year and industry, or ...
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Panel Regression with Repeated Dependent Variable

I am conducting Fixed Effects Regression Analyses (Panel Regression) to analyze characteristics of firm-disclosures. My dependent variable is a disclosure characteristic (e.g. length, sentiment, ..). ...
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continuous difference in difference state policy

I have seen a paper where the authors run the following regression: $Y_{st} = \lambda_s+\mu_t + \beta log(Min Wage)_{st} + controls + error$ where $\lambda$ and $\mu$ are state and time fixed effects....

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