Question: 10.9 a. In the fixed effects regression model, are the fixed entity effects, ai, consistently estimated as n with T fixed? (Hint: Analyze the

10.9

a. In the fixed effects regression model, are the fixed entity effects, ai, consistently estimated as n¡ with T fixed? (Hint: Analyze the model with no X’s: Yit = ai + uit.)

b. If n is large (say, n = 2000) but T is small (say, T = 4), do you think that the estimated values of ai are approximately normally distributed?

Why or why not? (Hint: Analyze the model Yit = ai + uit.)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Econometrics Questions!

full detailed answer in letter order please 3 . ( Stock and Watson # 1 0 . 1 0 ) a . In the fixed effects regression model, are the fixed entity effects, \ alpha _ i , consistently estimated as n - >...

1. Catfood. The game company PONOS has a monopoly over catfood, an in-game money in the game Battle Cats. Those who become addicted to Battle Cats very much want catfood, and there is no substitute....

a. The researcher collects data on the average snowfall for each state and adds this regressor (AverageSnowi) to the regressions given in Table 10.1. b. The researcher collects data on the snowfall...

10.9 a. In the fixed effects regression model, are the fixed entity effects, ai, consistently estimated as n with T fixed? (Hint: Analyze the model with no Xs: Yit = ai + uit.) b. If n is large...

a. In the fixed effects regression model, are the fixed entity effects, a, con- sistently estimated as n with 7 fixed? (Hint: Analyze the model with no X's: Ya, + u;-) b. If n is large (say, n =...

Corporate Resilience and Response to COVID-19 by Alex Cheema-Fox, Bridget R. LaPerla, and Hul (Stacie) Wang, State Street Associates; and George Serafeim, Harvard Business School he coronavirus...

Applied Econometrics 1 Homework Assignments/Problem Set 4 Submission due: January 144 2021 (Thursday); 12:00NN. Direction: Answer all the questions and submit your exercise in PDF. Include the...

1. In 2013, several data server companies took a dramatic decision to begin using energy surcharges to recapture rising energy costs. However, customers are critical of how the energy surcharges are...

A two-way fixed effects model, suppose that the fixed effects model is modified to include a time-specific dummy variable as well as an individual-specific variable. Then yit = i + t + 'xit + it. At...

Demand and Supply Discussion Question: Applications-Ubereconomics Please read the article below and respond to the follow-up question: Why Uber Is an Economist's Dream Does 'surge pricing'...

A company issued 8%, 10-year bonds with a face amount of $10o0 million. The market yield for bonds of similar risk and maturity is 4%. Interest is paid semiannually. At what price did the bonds sell?...

What is the pH of the buffer that results when 2.04 g of NH3 and 6.38 g of NH4Cl are dissolved in 250 mL water?

4. Other than for financial statements, management need report only the information it knows. That is, management should be under no obligation to gather information it does not have or does not need...

You modified the RentalDemo program for Sammys Seashore Supplies to accept and display data for an array of three Rental objects. Now, modify the program to use an array of eight Rental objects....