Panel data and unobservable individual effects

Hausman, Jerry A.; Taylor, William E.

doi:10.1016/0304-4076(81)90085-3

Cited by 1,073 publications

(1,178 citation statements)

References 2 publications

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“…Based on Hausman's (1978) test for a fixed-effects estimator versus a GLS estimator, Hausman and Taylor (1981) develop a test of the uncorrelation hypothesis required in stochastic frontier random-effects model. Hausman and Taylor (1981), assuming that the effects are uncorrelated with some but not all of the regressors, also allows for the treatment of time-invariant variables. In that framework, individual effects can be consistently estimated and separated from the intercept term as long as cross-sectional and temporal observations are large enough.…”

Section: Discussionmentioning

confidence: 99%

Economic Efficiency and Frontier Techniques

Zamorano

2004

Journal of Economic Surveys

319

179

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Abstract. Most of the literature related to the measurement of economic efficiency has based its analysis either on parametric or on non-parametric frontier methods. The choice of estimation method has been an issue of debate, with some researchers preferring the parametric and others the non-parametric approach. The aim of this paper is to provide a critical and detailed review of both core frontier methods. In our opinion, no approach is strictly preferable to any other. Moreover, a careful consideration of their main advantages and disadvantages, of the data set utilized, and of the intrinsic characteristics of the framework under analysis will help us in the correct implementation of these techniques. Recent developments in frontier techniques and economic efficiency measurement such as Bayesian techniques, bootstrapping, duality theory and the analysis of sampling asymptotic properties are also considered in this paper.

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Section: Discussionmentioning

confidence: 99%

Economic Efficiency and Frontier Techniques

Zamorano

2004

Journal of Economic Surveys

319

179

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“…Furthermore, panel data has the characteristics of controlling the endogeneity and heterogeneity problems. So the panel regression model analyzes the individual specific factor in different cross sections and in different time series of dependent variable with the independent variables (Hausman & Taylor, 1981 In the above equation (1), the endogeneity is denoted by X' it and the individual effect or heterogeneity is expressed by Z' t which postulates a stable and recognizable and non-recognizable variables. OLS evaluation supplies proficient and steady approximation of the original considerations (Kyereboah, 2007).…”

Section: Analytical Framework and Empirical Model Specificationmentioning

confidence: 99%

Firms' Aggressiveness and Respective Performance: An Empirical Study Under Pakistani Scenery

Rehman¹

2017

International Journal of Entrepreneurial Knowledge

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The study investigates capital structure of all non-financial listed firms on Pakistan Stock Exchange (PSX) for the period of 2008 to 2014. To test the relation between firm aggressive behavior and its performance, the study uses exponential generalized least square regression by employing control variables. Levin, Hadri and ADF test are used to know the stationarity of data. Furthermore different diagnostic tests like VIF, Weisberg test for heteroskedasticity and Breusch and Pagan Lagrangian multiplier test for random effects are used to check the data normality. Results of the study reveals that financial managers' aggressiveness regarding financial policy is negatively, while aggressiveness regarding investment policy is positively effecting the firm's performance. The study also found that with the passage of time, firms in Pakistan have been devastating their performance. That's why study found negative relation between firms' age and dependent variables. KEYWORDSCapital Structure, Firm's Performance, ROI, ROA. JEL CLASSIFICATION B26, D04, D22, F65 INTRODUCTIONFinancial performance of the firm and its value is greatly affected by the design of its capital structure. The research work of Modigliani (1958) put light on determinants of capital structure and factors that affecting this decision. So the issue regarding working capital management is getting immense consideration after the Modigliani (1958) hypothesis. Various researcher work on this concept to reveal the main idea, which enriches literature in the following forms: (a) Modigliani (1958) proposes that capital structure design has no relation with firm value (b) Modigliani (1963) contended that interest expense is beneficial to the firm as it work as tax shield for the firm. So their study recommends high use of leverage in the capital structure.(c) The point L in Figure 1 postulates the optimal capital structure position. If debt is furthermore boost from point L, financial distress cost increases compare to leverage benefits. (d) This balanced association will supplementary be changed when taking into consideration the effect of other variables like agency conflicts, informational asymmetry, financial distress etc… (e) The concluding concern of the study integrates the inclination of management towards financial preference selection (Myers 1984). By doing this, there is not full control in the finance manager hands plus there's sufficient equity balance for firm's robust solvency position.Key: W: firm value; L: leverage; L', L'' and L''': optimal capital structure Previous researches mainly study the working capital and its impact on firm performance (Harris, 1991;Rajan, 1995;Akhtar, 2005;Shah, 2007;Ezeoha, 2008 andAkhtar, 2009). However this study try to identify the manager aggressiveness regarding working capital management and its impact on firm operation in the long and short run. Problem statementFrom the past few decades, it has been observed from the literature that decisions of finance manager regarding working capital are genera...

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“…Post-Civil War files at the archive tended to include a certificate of organization, rather than the more detailed articles; certificates only provided information on a bank's corporate name, the city in which its business was to be located, its capital, and its subscribing shareholders. Directors were not regularly identified in the certificates, though director lists could sometimes be recovered from other correspondence between a bank and the 18 Hausman and Taylor (1981) show that fixed-effects estimates control for omitted variable bias in panel data sets, but Angrist and Pischke (2009) show that instrumental variables estimates are more likely to produce causal estimates when a good instrument can be identified. We have not been able to identify a valid instrument.…”

Section: Datamentioning

confidence: 99%

Corporate Governance and the Development of Manufacturing Enterprises in Nineteenth-Century Massachusetts

White¹,

Bodenhorn²

2015

Enterprising America

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte.

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Panel data and unobservable individual effects

Cited by 1,073 publications

References 2 publications

Economic Efficiency and Frontier Techniques

Economic Efficiency and Frontier Techniques

Firms' Aggressiveness and Respective Performance: An Empirical Study Under Pakistani Scenery

Corporate Governance and the Development of Manufacturing Enterprises in Nineteenth-Century Massachusetts

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