Stata — Panel Data

Introduction to Panel Data in Stata

10. Best Practices and Pitfalls

| Pitfall | Solution | |---------|----------| | Forgetting to xtset | Always start with xtset | | Using RE when FE is needed | Run Hausman test | | Ignoring serial correlation | Use xtreg, fe with cluster-robust or xtregar | | Overlooking unbalanced panels | Check xtdes and consider xtbalance | | Not reporting within/between R² | Report both from xtreg, fe | stata panel data

C. Testing for Cross-Sectional Dependence

Are entities affected by common shocks (e.g., global financial crisis)? Introduction to Panel Data in Stata 10

Between: Variance between different entities (cross-sectional variation). Describing and Exploring Data Panel data requires looking

Stata will confirm if the data is "strongly balanced" (all entities have data for all years) or "unbalanced". The Stata Forum 2. Describing and Exploring Data Panel data requires looking at variation both entities over time and different entities. Summarize Panel Data: Provides three sets of statistics: (full sample), (variation across entities), and (variation over time for a single entity). List Data Structure: xtdescribe