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st: Panel Fixed effects collinearity problem
I would like to run a panel FE model as I am unconvinced that my disturbance variable is unrelated to my predictor variables (X). However, I run into the problem of collinearity of several of my control variables with my panel id as they do not all change with time. For example, I have an industry munificence control variable that was calculated for the full time period of my panel that is the same for all t.
Am I forced to run a RE model in this case?
My error is as follows:
independent variables are collinear with the panel variable orgnr
Thanks for your help.
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