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

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Probit and logit models can be applied to panel data, but the effectiveness depends on the sample size and bias. With 50 subjects and 20 observations each, there is a sufficient amount of data for statistical analysis. However, the sample is heavily skewed towards large public companies, which limits the generalizability of the findings to smaller firms. Researchers should be cautious about drawing broad conclusions from such a biased sample. Overall, while the models can be used, the inherent biases must be acknowledged.
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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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