Abstract:
This paper examines panel data models, which vary in size and shape depending on their properties. When parameters vary across units and time, it is called a heterogeneous panel data model. The paper proposes suitable tests for slope homogeneity in three-dimensional panel data, using actual data from the United Nations Industrial Development Organization (UNIDO). The results showed significant evidence of cross-sectional dependence and slope heterogeneity. The paper recommends mean group, common correlated effect mean group, and augmented mean group estimators for heterogeneous three-dimensional panel data models in the case of cross-sectional dependency, with the common correlated effect mean group estimator being the most accurate.