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st: a question on testing for random effect model against fixed effect model
I have a question on testing random effect model against fixed effect
model. Hope that you can help me out. Here is the question;
I am applying random effect model and fixed effect model to an
unbanlanced panel data (use xtreg, re and xtreg, fe). To test which
model is more appropriate, I run a hausman test. However, the test
statistics (the chi square) is negative. This makes hausman testing
impossible, since chi square cann't be negative. The reason that hausman
test doesn't work is that the model's error structure does not meet the
assumptions made for the hausman test.
Then I was thinking about using command "suest". However, it turns out
that this command can not be used with "xtreg".
I wonder if there are any other ways of testing random effect models
against fixed effect models. Thanks.
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