In this assignment you will describe a panel analysis of data with two fixed effects dimensions neither of which is time or geographic space (for example, one dimension cannot be months, years, minutes or any time-related phenomenon and the other cannot be residential housing lots, states, countries or any other spatial entities). Put you answers after each of the questions.
1. What is the general context for your analysis?
2. What is a hypothesis, the testing of which will be facilitated by a panel analysis?
3. What is the dependent variable?
4. What are the independent variables other than the fixed effects?
5. What is your first fixed effect dimension?
6. What is your second fixed effect dimension?
7. Write out an equation for your model that could be estimated.
8. Make an Excel spreadsheet to show what the data that you would use to estimate the parameters of the equation would look like.
You do not need actual data for you dependent variable or your independent variables. For example, the data for your dependent variable in your spreadsheet are Y1, Y2, etc. You must use actual data for dummy variables (0,1). If your spreadsheet is too large to fit here put it on an attached page.
9. Interpret each of the coefficients in your model.
10. Discuss how a third dimension of fixed effects without constraints (i.e., you can use space and time) might be added to your analysis.
11. Discuss how you can use Eviews to estimate your parameters.