Can Probit or Logit Models Be Used on Panel Data with 50 Subjects?

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SUMMARY

Probit and logit models can be applied to panel data, even with a sample size of 50 subjects, as discussed in the forum. However, the analysis may yield biased results due to the selection criteria, which focuses exclusively on the 50 largest US public companies. While 50 subjects provide a sufficient statistical foundation, the conclusions drawn from such a biased sample cannot be generalized to smaller companies. Researchers must be cautious about the implications of their findings when using this data.

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Is it possible to use probit or logit models on panel data?

Mons
 
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monsmatglad said:
Is it possible to use probit or logit models on panel data?

Mons
Yes, but depending on the number of people there may not be enough data to do any meaningful statistics. Also, depending on the selection criteria the panel may constitute a very biased sample
 
I have about 50 different "individuals" and (optimally) 20 observations for each. the "individuals" are chosen based on a list of the 50 largest US, public companies at the time of the first observation. Do you see any immediate reasons for concern, based on this information (if I am using this data material for a logit or probit model)?

Mons
 
50 subjects should be enough for reasonable statistics. Your sample is highly biased towards large companies, so your conclusions should not be generalized to smaller companies.
 
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