Hi all!

I am struggling a bit to figure out which is the best command to use for OLS on unbalanced panel data with N (88 countries) > T (12 years). Not every country has the same number of observations (unbalanced). My data is xtset. My DV (corruption index) is obviously autocorrelated. I know there are various methods to deal with autocorrelation, but I am struggling to figure out which one is best for my data.

My confusion in deciding which regression method to use stems from:

1) I have both continuous economic covariates that vary greatly within panels (suited to re), but I also have institutional covariates that vary little (suited to fe). I was given the advice that I should choose random effects over fixed effects given my list of covariates.

2) Stata won't let me use the command corr(AR1) because my panels are unbalanced.

3) xtpcse seems like it could solve the problem above, but everything I've read says xtpcse is for T > N. Even after looking at the stata manual, I still don't fully understand the subcommands for xtpcse.

4) I know that using a forwarded DV and including a contemporary IV is an option, but I don't know which commands are most suited to doing so.

I have run the following models successfully without errors, but the significance of my coefficients varies quite a lot.

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xtreg f.vdem_corr $vars $vars2 vdem_corr, re

xtregar vdem_corr $vars $vars2, re

reg f.vdem_corr $vars $vars2 vdem_corr, cluster(ccode_qog)

xtpcse f.vdem_corr $vars $vars2 vdem_corr, hetonly detail

xtpcse f.vdem_corr $vars $vars2 vdem_corr, independent

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Right now xtregar seems like the best option, but I'm unsure. I am not new to stata, but I am somewhat new to working with panel data. I'm working on my 2nd year practicum, and this is my first time posting in a stata forum. I've been browsing forums for hours looking at answers to similar questions, but doing so only expanded my options rather than narrowing them down. Any help would be MUCH appreciated.

Sincerely,

burned out grad student