[Clyde Schechter]

There are two different ways of indicating individual fixed effects. You can have alpha_i, or you can have alpha₀ + mu_i. These are equivalent models: in the first case the alpha_i term identifies a specific individual effect. When it is written as alpha₀ + mu_i, some central value of the fixed effects (typically a mean) and the mu_i then represent individual-specific deviations from that central value.

[sedki zn]

There are two different ways of indicating individual fixed effects. You can have alpha_i, or you can have alpha₀ + mu_i. These are equivalent models: in the first case the alpha_i term identifies a specific individual effect. When it is written as alpha₀ + mu_i, some central value of the fixed effects (typically a mean) and the mu_i then represent individual-specific deviations from that central value.

i really appreciate your help dear professor
thank you very much.

_{so if i get it correctly, specific effects (}alpha<sub>0) are not allowed in the same model with time or/and industry fixed effects ( the case of the paper i am studying)?

kind regards</sub>

[Clyde Schechter]

_{so if i get it correctly, specific effects (}alpha_{0) are not allowed in the same model with time or/and industry fixed effects ( the case of the paper i am studying)?}

No, that isn't correct. As I said in #10, one could have both an alpha₀ and a mu_i or a time fixed effect in the same model. When that occurs, it just means that alpha₀ is some central value of the fixed effects, and the term mu_i or mu_t then represents the difference between the individual or time-specific effect and the chosen central value alpha₀.

[sedki zn]

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No, that isn't correct. As I said in #10, one could have both an alpha₀ and a mu_i or a time fixed effect in the same model. When that occurs, it just means that alpha₀ is some central value of the fixed effects, and the term mu_i or mu_t then represents the difference between the individual or time-specific effect and the chosen central value alpha₀.

Thank you dear Professor

so the best and the correct way to write the model with individual fixed effects, time fixed effects and industry fixed effects is as follow :

yes ?
again, Do accept my apologizes for that much of questions

kind regards

[Clyde Schechter]

Yes, that's right.

[sedki zn]

Yes, that's right.

Thank you very much dear Professor

stay safe
kind regards