initial level of depvar

[Zorodzai Murinye]

Hi statalist, I'm looking at panel data across countries and industries, so for example with 10 industries across 5 countries across 10 years would yield 500 industry_country_yearl observations. Now I have been asked to include an initial level of the dependent variable that controls for variation in industry and country. So with regression model for industry i, in country z at time t would show as:
reg depvar(i,z,t) control(i,z,t) initial_level(i,z) independentvar(i,z,t) controls, fe

Is this a correct specification of the initial level control?

[Fei Wang]

bys industry country (year): gen initial_level = depvar[1]

Above is a way of generating the initial-level. But it seems you are going to do a fixed effects estimation. Does that mean industry-country FE? If so, all industry-country level variables (like the initial-level) would be dropped from your regressions.