valueprhr (version 0.1.0)

test_mundlak_specification: Test Mundlak Specification

Description

Performs Wald test on the sector-mean coefficient to test whether fixed effects would be preferred over random effects.

Usage

test_mundlak_specification(mundlak_result)

Value

A list with test statistic, degrees of freedom, and p-value.

Arguments

mundlak_result

Result from fit_mundlak_cre.

Details

Under the null hypothesis that the sector means coefficient equals zero, random effects would be appropriate. Rejection suggests fixed effects should be used.

Examples

# \donttest{
if (requireNamespace("plm", quietly = TRUE)) {
  set.seed(123)
  panel <- data.frame(
    year = rep(2000:2009, 5),
    sector = rep(LETTERS[1:5], each = 10),
    log_direct = rnorm(50, 5, 0.5),
    log_production = rnorm(50, 5, 0.5)
  )
  panel$log_production <- panel$log_direct * 0.95 + rnorm(50, 0, 0.1)

  mundlak_fit <- fit_mundlak_cre(panel)
  test_result <- test_mundlak_specification(mundlak_fit)
  print(test_result)
}
# }