Dear Members,
I would like to know how do deal with cross sectional dependences.
I have started doing something after some readings as follow:
After running fixed effect model I run "xtcsd, pesaran" for cross sectional dependence. My data indicates that there is a sectional dependence.
I have unbalanced panel dataset where N>T (N=56 and T=16).
xtpcse is suitable ?
If yes I would like to know if it obligatory to add an option? (I found an example like this : eg: xtpcse variables, c(psar1) )
And then, if it is obligatory, how to know which option I must apply ?
Thanks in advance
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