What is the primary advantage of using panel data rather than a large cross- section data set collected over time?
A)it allow you to control for individual heterogeneity
B)it allows the effects of legislation to be estimated
C)it gives you more degrees of freedom
D)it allow coefficients to vary over time

Question

Quizplus · Accepted Answer

Panel data allows for the control of individual heterogeneity by observing the same individuals over time, whereas a large cross-section data set only captures individuals at a single point in time and does not allow for individual-specific controls. Therefore, the primary advantage of using panel data is to control for individual heterogeneity.

What Is the Primary Advantage of Using Panel Data Rather