Pooled OLS, fixed effects (FE), and random effects (RE) models
| Variable/Item | Pooled OLS | Fixed effects (FE) | Random effects (RE) |
|---|---|---|---|
| Constant | 0.694** (0.031) | 1.183*** (0.006) | 0.903** (0.013) |
| ESG | −0.006** (0.041) | −0.007** (0.024) | −0.007** (0.028) |
| LC | −0.005*** (0.008) | −0.004** (0.020) | −0.005** (0.016) |
| BFS | −0.003** (0.037) | −0.003* (0.089) | −0.003** (0.046) |
| SIZE | −0.775*** (0.000) | −0.693*** (0.004) | −0.742*** (0.001) |
| CAP | −0.028 (0.351) | −0.045* (0.076) | −0.049** (0.021) |
| GDP | 0.019 (0.242) | −0.017 (0.328) | −0.018 (0.298) |
| INF | 0.019 (0.493) | 0.036*** (0.010) | 0.038*** (0.007) |
| BC | 0.001 (0.772) | −0.002 (0.715) | −0.001 (0.942) |
| BNK | −0.009 (0.528) | −0.013 (0.334) | −0.011 (0.421) |
| DCOVID | −0.795** (0.042) | −0.309* (0.087) | −0.326* (0.069) |
| F stats | 18.12*** | 12.67*** | 14.01*** |
| R-squared | 0.6810 | 0.5347 | 0.5786 |
| Banks (i) | 62 | 62 | 62 |
| Panel data model statistical tests | Breusch-Pagan LM: Pooled vs. RE: χ2(1) = 251.84*** | F-test: Pooled vs. FE: F = 12.67*** | Hausman test: FE vs. RE: χ2 = 1.215 |
| Panel data model selection | Reject H0: Pooled OLS inappropriate (panel effects exist) | Reject H0: Pooled OLS inappropriate (unit effects exist) | Fail to reject H0: No significant difference between FE and RE; thus, Random Effects (RE) is appropriate |
| Variable/Item | Pooled OLS | Fixed effects (FE) | Random effects (RE) |
|---|---|---|---|
| Constant | 0.694** (0.031) | 1.183*** (0.006) | 0.903** (0.013) |
| ESG | −0.006** (0.041) | −0.007** (0.024) | −0.007** (0.028) |
| LC | −0.005*** (0.008) | −0.004** (0.020) | −0.005** (0.016) |
| BFS | −0.003** (0.037) | −0.003* (0.089) | −0.003** (0.046) |
| SIZE | −0.775*** (0.000) | −0.693*** (0.004) | −0.742*** (0.001) |
| CAP | −0.028 (0.351) | −0.045* (0.076) | −0.049** (0.021) |
| GDP | 0.019 (0.242) | −0.017 (0.328) | −0.018 (0.298) |
| INF | 0.019 (0.493) | 0.036*** (0.010) | 0.038*** (0.007) |
| BC | 0.001 (0.772) | −0.002 (0.715) | −0.001 (0.942) |
| BNK | −0.009 (0.528) | −0.013 (0.334) | −0.011 (0.421) |
| DCOVID | −0.795** (0.042) | −0.309* (0.087) | −0.326* (0.069) |
| 18.12*** | 12.67*** | 14.01*** | |
| 0.6810 | 0.5347 | 0.5786 | |
| Banks (i) | 62 | 62 | 62 |
| Panel data model statistical tests | Breusch-Pagan LM: Pooled vs. RE: | Hausman test: FE vs. RE: | |
| Panel data model selection | Reject H0: Pooled OLS inappropriate (panel effects exist) | Reject H0: Pooled OLS inappropriate (unit effects exist) | Fail to reject H0: No significant difference between FE and RE; thus, Random Effects (RE) is appropriate |
Note(s): *, *, and *** indicate significance at the 10%, 5%, and 1% levels, respectively. Numbers in parentheses are p-values
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