Hi All,

I am using micro level dependent and country level independent variable. Just for example, firm profitability and inflation, my problem is that I don't have panel data on micro level dependent variable, therefore, I am using a pooled cross sectional data consists of 39000 firms and 47 countries, as some of countries repeats in the next survey with unique firms, therefore at maximum I have 73 country level values as independent variable. I have doubt on feasibility of this study ? can I go with it? any reference ?

Secondly, I have 2 firm level dependent variable proxies and 3 country level proxies for independent variable.. I ran 6 regression using instrumental approach.. for some regression the t-statistic is very high at first stage of regression around 100 to 500 .. again, I be concerned with this high t statistic? (note: at first stage both endogenous regressor and instrument variable are country level in other words both contain 73 observations at maximum)

third, a high constant value of 100 to 1500, is problematic?

Can expert please provide their opinions?