Consider the model with a single regressor Yit = 1X1,it + i + t + uit. This

Consider the model with a single regressor Yit = β1X1,it + αi + λt + uit. This model also can be written as

where B2i = 1 if t = 2 and 0 otherwise, D2i = 1 if i = 2 and 0 otherwise, and so forth. How are the coefficients (β0, δ2,...., δT, γ2,..., γn) related to the coefficients (α1,..., αn, λ1,..., λT)?

Transcribed Image Text:

Y = Bo+ B,X+ dzB2, + + 87BT, + y2D2; + + Y„Dn; + u ...