Hello, i want to analyze a Panel-Data over 25 years with the following macro variables: unemployment rate, oil revenue, gdpgrowth.
My question is the following: Is it appropriate to use a fixed effect regression model and to adjust for the endogeneity concerns with let’s say a lag(1) variable?
For example:
xtreg Unemploy L.OilRents OilRents L.Gdpgrowth Gdpgrowth i.country i.year,fe robust
Or is only a vector autoregression model the right way to analyze this data type? A feedback would be very helpful
Best Regards
John Marburg
My question is the following: Is it appropriate to use a fixed effect regression model and to adjust for the endogeneity concerns with let’s say a lag(1) variable?
For example:
xtreg Unemploy L.OilRents OilRents L.Gdpgrowth Gdpgrowth i.country i.year,fe robust
Or is only a vector autoregression model the right way to analyze this data type? A feedback would be very helpful
Best Regards
John Marburg
