In Order to Run a Two-Way Fixed Effect Model, We

question 20

Multiple Choice

In order to run a two-way fixed effect model, we can use:

• A) A de-meaned approach
• B) A LSDV approach
• C) Both a and b
• D) None of the above.

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Definitions:

Concept

Any abstract characteristic or attribute that has the potential to be measured.

Indicator Variables

Variables, often used in statistical models, that take on a value of 0 or 1 to indicate the absence or presence of a categorical effect that may impact the result.

Validity

The degree to which an indicator accurately measures or reflects a concept.

Reliability

The likelihood that a particular measure would produce the same results if the measure were repeated.