Suppose we have a panel data of of 100 firms over 20 years at a monthly frequency. We are interested in how firms’ bond ratings affect their investment. Give an example of an omitted variable that can be fixed by Fixed Effects or First Differences. Give another example of an omitted variable that cannot be fixed by Fixed Effects or First Differences
Suppose we have a panel data of of 100 firms over 20 years at a monthly frequency. We are interested in how firms’ bond ratings affect their investment. Give an example of an omitted variable that can be fixed by Fixed Effects or First Differences. Give another example of an omitted variable that cannot be fixed by Fixed Effects or First Differences
Glencoe Algebra 1, Student Edition, 9780079039897, 0079039898, 2018
18th Edition
ISBN:9780079039897
Author:Carter
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Chapter4: Equations Of Linear Functions
Section4.5: Correlation And Causation
Problem 2AGP
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Suppose we have a panel data of of 100 firms over 20 years at a monthly frequency. We are interested in how firms’ bond ratings affect their investment. Give an example of an omitted variable that can be fixed by Fixed Effects or First Differences. Give another example of an omitted variable that cannot be fixed by Fixed Effects or First Differences
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