Lab 8 — Fixed Effects Estimation, Random Effects Estimation, Choosing the best approach

8 janeiro 2026, 12:30 • Hugo Castro Silva

Revising Panel Data Methods

Pooled OLS (POLS)
First Differences
Fixed Effects

• Estimating the least squares dummy variable
  
• Computing time demeaned variables using Stata (the "by" prefix again, and the "egen" command) 
  
• Using "xtreg, fe" to obtain the fixed effects estimates. This approach is better than doing it manually, for many reasons.
  

Estimating Random Effects

Random Effects Estimation

• Assumptions of RE
  
• Advantages and Disadvantages
  

FE vs RE (Hausman test)
FE vs FD vs RE vs POLS

Lab 8 — Fixed Effects Estimation, Random Effects Estimation, Choosing the best approach

8 janeiro 2026, 11:00 • Hugo Castro Silva

Revising Panel Data Methods

Pooled OLS (POLS)
First Differences
Fixed Effects

• Estimating the least squares dummy variable
  
• Computing time demeaned variables using Stata (the "by" prefix again, and the "egen" command) 
  
• Using "xtreg, fe" to obtain the fixed effects estimates. This approach is better than doing it manually, for many reasons.
  

Estimating Random Effects

Random Effects Estimation

• Assumptions of RE
  
• Advantages and Disadvantages
  

FE vs RE (Hausman test)
FE vs FD vs RE vs POLS

Lab 8 — Fixed Effects Estimation, Random Effects Estimation, Choosing the best approach

6 janeiro 2026, 16:30 • Hugo Castro Silva

Revising Panel Data Methods

Pooled OLS (POLS)
First Differences
Fixed Effects

• Estimating the least squares dummy variable
  
• Computing time demeaned variables using Stata (the "by" prefix again, and the "egen" command) 
  
• Using "xtreg, fe" to obtain the fixed effects estimates. This approach is better than doing it manually, for many reasons.
  

Estimating Random Effects

Random Effects Estimation

• Assumptions of RE
  
• Advantages and Disadvantages
  

FE vs RE (Hausman test)
FE vs FD vs RE vs POLS

Ch. D Fixed Effects, First Differences, Random Effects. Comparison of panel models (conclusion)

6 janeiro 2026, 14:30 • Hugo Castro Silva

Ch. D. Panel Data Analysis II: Fixed effects, First Differences, and Random Effects

Comparison of POLS, RE, FD, FE

Applying panel methods to other data structures

• revisiting the idea of fixed effects as group dummies

Solving previous exams, in preparation for the upcoming MAP2

Lab Test 2 . Lab 8 — Fixed Effects Estimation

18 dezembro 2025, 12:30 • Hugo Castro Silva

Lab Test 2

Fixed Effects Estimation