Abstract
Panel data combine cross-section data and time series data. If the cross-section is locations, there is a need to check the correlation among locations. ρ and λ are parameters in generalized spatial model to cover effect of correlation between locations. Value of ρ or λ will influence the goodness of fit model, so it is important to make parameter estimation. The effect of another location is covered by making contiguity matrix until it gets spatial weighted matrix (W). There are some types of W—uniform W, binary W, kernel Gaussian W and some W from real case of economics condition or transportation condition from locations. This study is aimed to compare uniform W and kernel Gaussian W in spatial panel data model using RMSE value. The result of analysis showed that uniform weight had RMSE value less than kernel Gaussian model. Uniform W had stabil value for all the combinations.
Highlights
Panel data analysis combines cross-section data and time series data, in sampling when the data are taken from different locations
Spatial dependence in this study is covered by generalized spatial model which is focussed on dependence between locations and errors [1]
This research is aimed to compare uniform W and kernel Gaussian W in generalized spatial panel data model using RMSE value which is obtained from simulation
Summary
Panel data analysis combines cross-section data and time series data, in sampling when the data are taken from different locations. There is spatial correlation between the observations, which is spatial dependence. (2015) Comparison of Uniform and Kernel Gaussian Weight Matrix in Generalized Spatial Panel Data Model. Some recent literature of spatial cross-section data is Spatial Ordinal Logistic Regression by Aidi and Purwaningsih [2], and Geographically Weighted Regression [3]. For accomodating spatial dependence in the model, there is spatial weighted matrix (W ) that is an important component to calculate the spatial correlation between locations. Spatial parameter in generalized spatial panel data model, is known as ρ or λ. This research is aimed to compare uniform W and kernel Gaussian W in generalized spatial panel data model using RMSE value which is obtained from simulation
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