New method for panel data models revolutionizes social science research!
The article discusses a method to estimate panel data models with interactive effects, where variables are linked to unobserved factors. The usual method is unreliable, so the researchers developed a maximum likelihood estimator that is accurate and easy to use. They tested it with simulations and found it works well. They also expanded the model to include different types of variables, showing that the coefficients can change over time or across groups.