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Of Fixed-Effects and Time-Invariant Variables

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  • Beck, Nathaniel

Abstract

What follows is a longish controversy (two critiques, a reply and two rejoinders) over the quality of the estimates and associated SEs provided by Plümper and Troeger's (2007) “fixed-effect vector decomposition” (FEVD) procedure; Plümper and Troeger (PT) will refer to that article and not any persons. My role is to lay out some issues that separate the authors rather than to adjudicate between them. As with many controversies, a bit of heat is generated along with some light. Readers care a bit less than the authors about what was said when, but they do care a lot about what appropriate method to use when a panel data model has both unit-specific intercepts and variables that are invariant over a unit. Thus, I also take it upon myself to discuss some things that I gleaned from this controversy; this discussion has a bit less heat than what follows, but of course readers should judge the evidence for themselves.

Suggested Citation

  • Beck, Nathaniel, 2011. "Of Fixed-Effects and Time-Invariant Variables," Political Analysis, Cambridge University Press, vol. 19(2), pages 119-122, April.
    • Handle: RePEc:cup:polals:v:19:y:2011:i:02:p:119-122_01
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    1. repec:gig:joupla:v:4:y:2012:i:2:p:89-123 is not listed on IDEAS
    2. Lekha Chakraborty & Pinaki Chakraborty, 2018. "Federalism, fiscal asymmetries and economic convergence: evidence from Indian States," Asia-Pacific Journal of Regional Science, Springer, vol. 2(1), pages 83-113, April.
    3. Chwieroth, Jeffrey, 2012. ""The silent revolution": how the staff exercise informal governance over IMF lending," LSE Research Online Documents on Economics 46623, London School of Economics and Political Science, LSE Library.
    4. Lumir Abdixhiku, Geoff Pugh, Iraj Hashi, 2018. "Business Tax Evasion in Transition Economies: A Cross-Country Panel Investigation," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 15(1), pages 11-36, June.
    5. Tsusaka, T. & Orr, A. & Msere, H. & Harris, D. & Rao, N. Vpr Ganga, 2018. "Fuelwood or Grain? A Conjoint Analysis of Trait Preferences for Pigeonpea among Smallholders in Southern Malawi," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277435, International Association of Agricultural Economists.
    6. George A. Krause & David E. Lewis & James W. Douglas, 2013. "Politics Can Limit Policy Opportunism in Fiscal Institutions: Evidence from Official General Fund Revenue Forecasts in the American States," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 32(2), pages 271-295, March.
    7. Jeffrey Chwieroth, 2013. "“The silent revolution:” How the staff exercise informal governance over IMF lending," The Review of International Organizations, Springer, vol. 8(2), pages 265-290, June.
    8. Tunçer, Ali Coşkun & Weller, Leonardo, 2022. "Democracy, autocracy, and sovereign debt: How polity influenced country risk on the peripheries of the global economy, 1870–1913," Explorations in Economic History, Elsevier, vol. 85(C).

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