Dear all,
After the great advice I got yesterday, I would be very happy if someone would know the answer to a question I have been struggling with for quite some time.
After running a regression with fixed effects in the form of
I obtained and plotted the residuals. There seem to be fat tails when looking at the distribution however. This would suggest many outliers of the residuals. After doing some reading, I read that non normality /Heteroskedasticity of the residuals can be taking into account by using clustered standerd errors when N is large enough. Does this mean I should not worry about fat tails?
After the great advice I got yesterday, I would be very happy if someone would know the answer to a question I have been struggling with for quite some time.
After running a regression with fixed effects in the form of
Code:
xtreg y x1 x2 i.year, fe
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