Re: [Gretl-users] Random-effects panel-data

On Thu, 16 Feb 2012, Helgi Tomasson wrote: > I am doing a panel-data exercise from Greene (5th. ed. ) exercise 13.1 > Why do I get precisely the same estimates in pooled OLS as in the > random-effects panel model? Here's the answer to your question > 'Within' variance = 3.0455 > 'Between' variance = 0.113088 > theta used for quasi-demeaning = 0 In finite samples, it may well happen that the estimate for theta goes outside its 'natural' limits (the 0-1 interval), in which case it's force d to 0. See any textbook for details (eg Greene --- used to be section 13.4 in the 5th edition, don't known in more recent versions).