st: xtabond and OLS for separate years

[Kate Ivanova <kivanova@usc.edu>]

Hi,

 

I am confused by the results I get using xtabond. I have a panel of 116 countries over 10 years and when I run separate regressions for each year using OLS, my variables (income and income squared) are highly significant (at a 0.001 level). But when I run xtabond with one lag of the dependent variable, they are not significant at all. I wonder why I have such a difference between the results. Any help, any ideas would be greatly appreciated.

 

Kate