Panel Data Models

Panel data models analyze data collected from the same subjects over multiple time periods. Imagine studying a group of individuals or companies, measuring their performance year after year. This approach allows researchers to observe changes over time and understand the effects of various factors while controlling for individual differences. By combining cross-sectional data (individuals at a single point in time) with time-series data (the same individual over time), panel data models provide deeper insights into trends, behaviors, and relationships than either method alone. This makes them valuable in economics, social sciences, and various fields of research.