Dear all,

I am running fixed effect panel data analysis (cross-section: none; period; fixed). My goal is to find out drivers of firms' decision on leverage.

My data has 9 years timespan with yearly frequency and consists of 75 companies, represented by 23 industries. My dependent variables are: long-term debt, short-term debt. Independent variables: profitability(x1), size(x2), tangibility(x3), liquidity(x4), non-debt tax shield(x5) median industry leverage(x6) and some other dummy variables.

I am confused with appropriate choice of:

1. GLS weights

2. Coefficient covariance method (White cross-section, White period, White (diagonal), Cross-section SUR, Cross-section weights, Period SUR, Period weights.

Also, what appropriate tests would you suggest to run, to be sure my regression is valid (after introduction of dummy variables Eviews no longer let me conduct heteroscedasticity test).

Thank you for your time.

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