Fixed Effects estimation with time-invariant variables
I have a problem and I wonder whether anyone can help. I have a panel
dataset of 32 Sub-Saharan African countries and four time periods
(N=32, T=4). I am looking at the determinants of aid for these
countries. Given that they are not randomly selected countries, I am
using Fixed Effects. However, I have a few time-invariant variables
that are important but that get dropped because of using FE. Is there
any way of obtaining estimates for these time-invariant variables and
still use FE? Also, given the data I'm using, is there any
justification for using Random Effects?
Any comments would be much appreciated.
Thanks.
Joana
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