Endogeneity in panel regression is a beast! Fixed effects help, but like you said, they don’t solve reverse causality. IV is tricky—I’ve had luck using lagged variables as instruments, but it’s hit or miss.
For smaller datasets, GMM might be overkill unless you’ve got strong instruments. Check out the `plm` package in R or `xtivreg` in Stata—they’ve saved me a few headaches.
Also, this paper on dynamic panel models helped me a ton: [link].
For smaller datasets, GMM might be overkill unless you’ve got strong instruments. Check out the `plm` package in R or `xtivreg` in Stata—they’ve saved me a few headaches.
Also, this paper on dynamic panel models helped me a ton: [link].