- #1
monsmatglad
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Hey.
I am doing a project where I am studying a set of companies over a 7-year period. I am doing a multiple linear regression analysis either with fixed or random effects (so, it's a panel study). What I am wondering is if the general assumptions/requirements apply when using the fixed/random effects technique, so that I should test for them to ensure they are fulfilled?
The assumptions I am referring to are:
- The variables are normally distributed
- The relation between the independent variables and the dependent variables are linear
- homoscedasticity
- independent and normally distributed residuals
(I plan to use a Hausman's test to decide on whether to use the fixed or random effects model)
Thanks in advance
Mons
I am doing a project where I am studying a set of companies over a 7-year period. I am doing a multiple linear regression analysis either with fixed or random effects (so, it's a panel study). What I am wondering is if the general assumptions/requirements apply when using the fixed/random effects technique, so that I should test for them to ensure they are fulfilled?
The assumptions I am referring to are:
- The variables are normally distributed
- The relation between the independent variables and the dependent variables are linear
- homoscedasticity
- independent and normally distributed residuals
(I plan to use a Hausman's test to decide on whether to use the fixed or random effects model)
Thanks in advance
Mons