Hi everyone. I'm so glad that I found this forum. Well, I really need some help regarding panel data. I'm doing my research in the impact of governance in performance. I have a panel data of 240 obs(n=40/T=6). My Dependent variable is performance (calculated by ROA ( return on assets)). As for my independents variables I have like the capital structure ( the % of CEO capital,...) and board of directors (size of the board), its independance ( its a dummy variable it takes 0 when the board has not independant directors, 1 otherwise) the existence of audit comittee ( dumly variable 0/1).......
1-So my first question I read a lot about panel data but actually in some publucations I find that the first step is the specification model ( homogeniety test) or hsiao test, in others No?? They try just to specify if the model is fe or re? Can you please tell me is the Hsiao test (homogeniety test) the first test to do in regression panel data?
2-second, is the use of independant dummy variables (I have 5 of them) well have an impact in my models and its significance?

Thank you and sorry for my english because I'm not a native speaker and I do my research in frensh. Thank you for your insights