[R] Regressions with fixed-effect in R

chen jia chen_1002 at fisher.osu.edu
Tue May 11 04:11:06 CEST 2010

Hi there,

Maybe people who know both R and econometrics will be able to answer
my questions.

I want to run panel regressions in R with fixed-effect. I know two
ways to do it.
First, I can include factor(grouping_variable) in my regression equation.
Second, I plan to subtract group mean from my variables and run OLS
panel regression with function lm().

I plan to do it with the second way because the number of groups is
large, which incur computational problems inverting large

I am interested in the R-squared and adjusted R-squared out of these

Do I need to adjust my R-squared after I run OLS regressions with
demeaned variables?

Are there any functions that specifically deal with fixed-effects?



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