A Panel Data Perspective

Panel data analysis refers to two or multi-dimensional data set containing observations on multiple phenomena observed over multiple time periods (Baltagi, 2005; Gujarati, 2003 among many others). Real gross domestic product (CGDP) per capita is the most commonly used measure of a country’s economic welfare. It is the number reached by valuing all the productive activity within the country at a specific year’s prices. Determinants of economics growth are evaluated, gathered for nine Asian countries for forty years that leads to use the panel data analysis, whereas panel data may have group effects, time effects or both. Data is taken from Penn Word Table (an expanded set of international comparisons), Version 6.1 (2003) for different Asian countries contributing in the world economy. In this article, the comparison of ordinary least square, fixed and random effects for panel data analysis is carried out. Different specification tests, e.g. Breusch Pagan Lagrange Multiplier test, F-test, and Hausman specification test, etc., are used to make selection among ordinary least square, fixed effect model or random effect model. Random effect model seems best to handle such situation