Perhaps, this problem has been already discussed. I myself have found that some people have faced with this problem, however I still did not get a clear answer to this problem, and how to proceed in this situation.
I have an unbalanced panel (for most individuals, I have two years of data, and for some individuals only one year). I want to know what stata does to observations (individuals) with only one year of data when I run a fixed effects model with either the xtreg, fe(id) command. It seems like the correct thing to do is to drop observations with only one year of data, but I am getting different results when I explicitly exclude individuals with only one-year of data and when I use Stata's fixed effects commands. In the regression equation i estimate something like that: y_it=var1_it+var_2it+dummy_i+e_it i'm interested in dummy, which is equal to 1 if individual works in the same industry as father's. For those who have it equal to 1 (working in the same industry as father's) dummy is constant in both years. So, I'm doubt if i correctly estimate equation, when in period t i compare the same individuals (who have dummy==1) with a group of some individuals, and in period t+1, I compare these individuals (dummy=1) with a bunch of other individuals, because the data is unbalanced and, subsequently, the comparison group differs between two periods. Of course, the sample composition for the group with dummy==1 can also change from period t to t+1. Can you please help me, what is the best way to proceed in this situation?
I have an unbalanced panel (for most individuals, I have two years of data, and for some individuals only one year). I want to know what stata does to observations (individuals) with only one year of data when I run a fixed effects model with either the xtreg, fe(id) command. It seems like the correct thing to do is to drop observations with only one year of data, but I am getting different results when I explicitly exclude individuals with only one-year of data and when I use Stata's fixed effects commands. In the regression equation i estimate something like that: y_it=var1_it+var_2it+dummy_i+e_it i'm interested in dummy, which is equal to 1 if individual works in the same industry as father's. For those who have it equal to 1 (working in the same industry as father's) dummy is constant in both years. So, I'm doubt if i correctly estimate equation, when in period t i compare the same individuals (who have dummy==1) with a group of some individuals, and in period t+1, I compare these individuals (dummy=1) with a bunch of other individuals, because the data is unbalanced and, subsequently, the comparison group differs between two periods. Of course, the sample composition for the group with dummy==1 can also change from period t to t+1. Can you please help me, what is the best way to proceed in this situation?
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