[R] fixed versus random effect

amatoallah ouchen at.ouchen at gmail.com
Sun Jul 4 17:24:39 CEST 2010


Good day R-listers,
i'm running a panel data regression and after performing the haussman test
the conclusion was that my model is a fixed effect one. The problem is
located on my explanatory variables which display week variations, and
as it is well known fixed effect model gives weak results in a such
case. So should 'i use the random effect instead??? my second question
is the following when i run my regression with just one variable X
(restricted model) they results said that it's very significant but
when  i add the rest of the variables, the findings show that it'
isn't significant at all, so what should i' trust the first or the
second results and why a such difference exist?
Any hint would be highly appreciated.

Thanks a lot in advance



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